4 ms·
It sounds real nice which is why this idea is so pervasive but it just doesn't hold up to reality. The employment effect of the minimum wage is one of the most
by frgtpsswrdlame 10y ago
It sounds real nice which is why this idea is so pervasive but it just doesn't hold up to reality.
The employment effect of the minimum wage is one of the most studied topics in all of economics. This report examines the most recent wave of this research – roughly since 2000 – to determine the best current estimates of the impact of increases in the minimum wage on the employment prospects of low-wage workers. The weight of that evidence points to little or no employment response to modest increases in the minimum wage.
http://cepr.net/documents/publications/min-wage-2013-02.pdf http://cepr.net/documents/publications/min-wage-2013-02.pdf
- Bartweiss 10y ago> to modest increases in the minimum wage "Modest" here seems like an unproven assumption. The gap between the Puerto Rican economy and US state economies is much larger than the gap between, say, Pennsylvania and New Jersey. As far as I know there's no real disagreement on the direction of the labor demand curve. If you put the minimum wage at $40/hour (or $10/hour in China) it would have massive consequences. So even granting the 'little or no' result, we haven't proved the "modest increase" charge for Puerto Rico.