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However paying workers less results in a lower demand for that job; increasing turnover and increasing operational costs. It isn’t as simple as a unilateral dec
by briandear 8y ago
However paying workers less results in a lower demand for that job; increasing turnover and increasing operational costs. It isn’t as simple as a unilateral decision to lower wages. In fact, companies like Chick Fil A actually pay higher wages because it gives them a competitive advantage in higher quality employees with lower turnover.
The issue isn’t as simplistic as people seem to imply.
- ryanobjc 8y agoAlso, there's some evidence that higher minimum wage drives more dollars thru the local economy, because minimum wage earners spend most/all of their wage, typically locally. This seems like an obvious outflow of monetary policy as economic driver, as per the liquidity trap analogy of the Capitol hill babysitting coop. (https://en.wikipedia.org/wiki/Capitol_Hill_Babysitting_Co-op#Allegory_for_a_liquidity_trap https://en.wikipedia.org/wiki/Capitol_Hill_Babysitting_Co-op...) The solution to the "but the market" is governmental action -- when market forces create an undesirable situation, its totally reasonable and rational to have a super-market entity enforce rules. This is not even a generally disagreeable point, we see it all the time, environmental laws, natural monopolies (eg: civic infrastructure), etc. The only question is where do we draw the line? The problem with a lot of libertarian type arguments is people seem to put the primacy of the market as an inviolable fact above human dignity.
- dragonwriter 8y ago> However paying workers less results in a lower demand for that job No, it results in a lower quantity of labor supplied assuming labor supply (the function mapping price to quantity supplied) is unchanged.