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Few things hurt the poor, in particular unskilled minorities, like minimum wage. Those people are effectively outlawed from the labor market because their margi

by ancap 9y ago

Few things hurt the poor, in particular unskilled minorities, like minimum wage. Those people are effectively outlawed from the labor market because their marginal productivity doesn't make the cut. This is why there is often exceptions in minimum wage laws when it comes to hiring youth and the disabled. This is also why you've seen labor unions lobbying for a $15/hr minimum wage, with exemptions for those in the union.

Sohcahtoa82 9y ago
> Few things hurt the poor, in particular unskilled minorities, like minimum wage. Those people are effectively outlawed from the labor market because their marginal productivity doesn't make the cut. Hogwash. Are you sincerely arguing that an hour of work doesn't produce $9-15 (or whatever the minimum wage is, plus other overhead) of revenue for the company they work for?
- sokoloff 9y ago
  The relevant hurdle for an hour of labor is not the marginal revenue but rather the contribution margin (marginal revenue minus [non-labor] variable costs) of that hour.
- ancap 9y ago
  I'm not sure what's so hard to believe about that. It's not even a controversial statement. Are you suggesting that if labor were cheaper the market would not consume more of it?
  - Sohcahtoa82 9y ago
    If there's a demand for X amount of product, and it will take Y people to provide the labor to supply that product, then businesses will hire Y people. They're not going to hire more than Y just because they can. The only time the market will consume more labor because its cheaper is if the amount of labor they already had was already insufficient, in which case if they really needed more people, they would have already hired them.
    - ancap 9y ago
      That's just wrong and demonstrates a fundamental lack of understanding of basic economics. If labor were much cheaper, I personally might be willing to hire a maid, a gardener, a masseuse, a cook, etc. Similarly a retail business might hire more cashiers, or have more staff on the floor to answer customers questions and help them find things. A gas station might provide a full service experience for their customers. You could do this analysis for virtually any type of business and given cheaper labor they would hire more people. Why is this so? Because the demand for labor, like goods, is infinite.

by ancap 9y ago

Sohcahtoa82 9y ago

> Few things hurt the poor, in particular unskilled minorities, like minimum wage. Those people are effectively outlawed from the labor market because their marginal productivity doesn't make the cut. Hogwash. Are you sincerely arguing that an hour of work doesn't produce $9-15 (or whatever the minimum wage is, plus other overhead) of revenue for the company they work for?

sokoloff 9y ago
The relevant hurdle for an hour of labor is not the marginal revenue but rather the contribution margin (marginal revenue minus [non-labor] variable costs) of that hour.
ancap 9y ago
I'm not sure what's so hard to believe about that. It's not even a controversial statement. Are you suggesting that if labor were cheaper the market would not consume more of it?
- Sohcahtoa82 9y ago
  If there's a demand for X amount of product, and it will take Y people to provide the labor to supply that product, then businesses will hire Y people. They're not going to hire more than Y just because they can. The only time the market will consume more labor because its cheaper is if the amount of labor they already had was already insufficient, in which case if they really needed more people, they would have already hired them.
  - ancap 9y ago
    That's just wrong and demonstrates a fundamental lack of understanding of basic economics. If labor were much cheaper, I personally might be willing to hire a maid, a gardener, a masseuse, a cook, etc. Similarly a retail business might hire more cashiers, or have more staff on the floor to answer customers questions and help them find things. A gas station might provide a full service experience for their customers. You could do this analysis for virtually any type of business and given cheaper labor they would hire more people. Why is this so? Because the demand for labor, like goods, is infinite.