5 ms·

> So... paying people more makes them less likely to eat at a restaurant? That logic doesn't work, you're forgetting the other side of the consumer equation. I

> So... paying people more makes them less likely to eat at a restaurant? That logic doesn't work, you're forgetting the other side of the consumer equation. It is often argued that it does, particularly by opponents of minimum wage increase. If they need to pay their salaries, they'll increase menu item prices, and a la supply and demand, fewer sales. This argument is for a single business only, I imagine the aggregate supply and demand is affected differently if one were to apply a minimum wage law instead of a hypothetical at one restaurant. Basic form of the argument would be if everyone makes more in a region, perhaps increases in prices are cancelled out. I'm not an economist, ymmv.

ajross 7y ago
> If they need to pay their salaries, they'll increase menu item prices, and a la supply and demand, fewer sales. You whooshed on the point. If their workers are paid higher salaries, they'll turn around and spend that money, and a la supply and demand, more sales! Details matter, making an argument like this without numbers isn't analysis, it's excuse-making. And the counter point (with numbers!) is that people at the bottom of society are getting poorer. And that this is more important as an immediate issue than a innumerate macroeconomic excuse.
- mrmuagi 7y ago
  > You whooshed on the point. If their workers are paid higher salaries, they'll turn around and spend that money, and a la supply and demand, more sales! I did mention it, that's the whole cancel out thing I was trying to hint at. I do really dislike this type of argumentation and tend to dismiss it because its first order argumentation without empirical evidence. The real world isn't first order, so real data should be used. The sort of stuff journalistic outlets use instead of economic institutes. I disagree that this is excuse-making however, because it is indeed analysis at an approximate level b/c its first order, but I take it you would probably take it that to be an excuse as well :) Also an banal extension of that line of reasoning leads to a counter point -- The products that they purchase will cost more because of an increase in the cost of manufacturing due to minimum wage laws. However globalisation side steps this by getting third worlds to produce most of the products, so kahbooy to those laws. > Details matter, making an argument like this without numbers isn't analysis, it's excuse-making. I agree, but this is kind of a moot point, you are burning the bridge we both stand on and saying standing on it is excuse-making because one person faces north instead of south. It's excuse-making in two directions. > And the counter point (with numbers!) is that people at the bottom of society are getting poorer. Objective poverty is decreasing in the world, but in the lenses of America, I do think you are correct and I agree that the bottom of the society are getting poorer in a relative wealth inequality sense. However as a side topic, there's a larger issue with financial ignorance I think exists too -- something that a higher minimum wage won't really counter. I mean, look at the high average debt, aggressive cash loans, lack of short term liquidity, etc, the poor of society suffer from or are explicitly targeted at. It's a whole system with people actively trying gut you for cash. A lot of it is just plain asymmetric power in terms of negotiating, knowledge, and opportunity. The poor get poorer, and the rich get richer, cycle of poverty 101. I personally believe wages should be legally adjusted for livability in a sense (the term liveable wage rings a bell, but I'm not too familiar) but the root cause of the issue seems to be in the education system and the affordability, proximity, and availability of it. Heck, I even like the idea of later-in-life re-training but I haven't dug into the data on that. Housing is also another can of worms.

ajross 7y ago

> If they need to pay their salaries, they'll increase menu item prices, and a la supply and demand, fewer sales. You whooshed on the point. If their workers are paid higher salaries, they'll turn around and spend that money, and a la supply and demand, more sales! Details matter, making an argument like this without numbers isn't analysis, it's excuse-making. And the counter point (with numbers!) is that people at the bottom of society are getting poorer. And that this is more important as an immediate issue than a innumerate macroeconomic excuse.

mrmuagi 7y ago
> You whooshed on the point. If their workers are paid higher salaries, they'll turn around and spend that money, and a la supply and demand, more sales! I did mention it, that's the whole cancel out thing I was trying to hint at. I do really dislike this type of argumentation and tend to dismiss it because its first order argumentation without empirical evidence. The real world isn't first order, so real data should be used. The sort of stuff journalistic outlets use instead of economic institutes. I disagree that this is excuse-making however, because it is indeed analysis at an approximate level b/c its first order, but I take it you would probably take it that to be an excuse as well :) Also an banal extension of that line of reasoning leads to a counter point -- The products that they purchase will cost more because of an increase in the cost of manufacturing due to minimum wage laws. However globalisation side steps this by getting third worlds to produce most of the products, so kahbooy to those laws. > Details matter, making an argument like this without numbers isn't analysis, it's excuse-making. I agree, but this is kind of a moot point, you are burning the bridge we both stand on and saying standing on it is excuse-making because one person faces north instead of south. It's excuse-making in two directions. > And the counter point (with numbers!) is that people at the bottom of society are getting poorer. Objective poverty is decreasing in the world, but in the lenses of America, I do think you are correct and I agree that the bottom of the society are getting poorer in a relative wealth inequality sense. However as a side topic, there's a larger issue with financial ignorance I think exists too -- something that a higher minimum wage won't really counter. I mean, look at the high average debt, aggressive cash loans, lack of short term liquidity, etc, the poor of society suffer from or are explicitly targeted at. It's a whole system with people actively trying gut you for cash. A lot of it is just plain asymmetric power in terms of negotiating, knowledge, and opportunity. The poor get poorer, and the rich get richer, cycle of poverty 101. I personally believe wages should be legally adjusted for livability in a sense (the term liveable wage rings a bell, but I'm not too familiar) but the root cause of the issue seems to be in the education system and the affordability, proximity, and availability of it. Heck, I even like the idea of later-in-life re-training but I haven't dug into the data on that. Housing is also another can of worms.