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>Higher minimum wages are probably another cause. >After declining in inflation-adjusted terms from 1998 to 2007, minimum wages rose almost 11% in real terms b
by scilro 9y ago
>Higher minimum wages are probably another cause.
>After declining in inflation-adjusted terms from 1998 to 2007, minimum wages rose almost 11% in real terms between 2007 and 2016, Abraham and Kearney estimated. Firms may have outsourced jobs or spent more on automation to offset the higher costs of low-skilled labor.
Is it just me, or is this a shockingly misleading paragraph? That minimum wages rose in real terms tells us nothing. They may have kept in place with inflation, or they may have even continued to fall in inflation-adjusted terms. This is not an apples-to-apples comparison at all.
- arebop 9y ago"inflation-adjusted terms" and "real terms" are the same thing. The author was trying to avoid repetition but the only contrast intended here is between the earlier decline and later rise.
- tuckermi 9y agoIt seems confusingly worded, but "real terms" does typically mean that it is adjusted for inflation. Assuming that is the case, it is apples-to-apples even though it is oddly phrased.
- deleted 9y ago[deleted]
- refurb 9y agoReal terms means inflation adjusted. Nominal means just the rate ignoring inflation.
- scilro 9y agoThanks, all. I thought that "real" was the same thing as nominal.
- stochastastic 9y agoI don’t think this is misleading; in economics parlance “real” terms means inflation adjusted. Perhaps you are thinking of “nominal” terms, which would not be?