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One can also argue that rising minimum wages directly benefit the economy as this money will be immediatly consumed. Giving $10 to a poor person will result in

One can also argue that rising minimum wages directly benefit the economy as this money will be immediatly consumed. Giving $10 to a poor person will result in $10 more goods and services demand. Giving $10 to a very rich person will probably make 1/10th of a share change hands and have no effect on the real economy whatsoever.

tryptophan 8y ago
This argument is a fallacy because it implies that money not spent is wasted somehow, but that is opposite of the truth, that savings underpin investment and thus growth.
- snarfybarfy 8y ago
  Well I would argue that currently the economy is limited by consumption and not investment. Google "asset price bubble" and compare this to the general inflation.
- moate 8y ago
  Considering that the largest economic problem of the last 20 years (well all human history really, but it's been a keystone of economic strife recently) is the dramatic difference in the wealth growth between the wealthy and the wage increases of the remaining population, that whole "trickle down economics" myth has been sorta shorted out. "Growth" can represent too many things and is thus a great slippery beast that can be used to obscure helping the wider population. We continue to see economic "growth" but wage increases has been stagnant for decades. Owners need fewer workers to amass revenue due to changes in the type economy as well as automation. You can grow a business without benefiting as many people as you used to. Look at how many people Bell Labs had working for it when it was in it's heyday vs how many people work for Google now.
mlcrypto 8y ago
Might as well break some windows too to cause $100 of demand
- mercutio2 8y ago
  Their must be a name for the rhetorical trick of conflating the transfer of wealth with the destruction of wealth. Both have the potential to increase economic activity, it’s true, but that’s about all they share, from a moral perspective.

tryptophan 8y ago

This argument is a fallacy because it implies that money not spent is wasted somehow, but that is opposite of the truth, that savings underpin investment and thus growth.

snarfybarfy 8y ago
Well I would argue that currently the economy is limited by consumption and not investment. Google "asset price bubble" and compare this to the general inflation.
moate 8y ago
Considering that the largest economic problem of the last 20 years (well all human history really, but it's been a keystone of economic strife recently) is the dramatic difference in the wealth growth between the wealthy and the wage increases of the remaining population, that whole "trickle down economics" myth has been sorta shorted out. "Growth" can represent too many things and is thus a great slippery beast that can be used to obscure helping the wider population. We continue to see economic "growth" but wage increases has been stagnant for decades. Owners need fewer workers to amass revenue due to changes in the type economy as well as automation. You can grow a business without benefiting as many people as you used to. Look at how many people Bell Labs had working for it when it was in it's heyday vs how many people work for Google now.

mlcrypto 8y ago

Might as well break some windows too to cause $100 of demand

mercutio2 8y ago
Their must be a name for the rhetorical trick of conflating the transfer of wealth with the destruction of wealth. Both have the potential to increase economic activity, it’s true, but that’s about all they share, from a moral perspective.