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A minimum wage is easy to enforce, but that's more of a bug than a feature. Minimum wages have two problems: 1) It's very hard to set it at a correct level. To
by Lazare 6y ago
A minimum wage is easy to enforce, but that's more of a bug than a feature. Minimum wages have two problems:
1) It's very hard to set it at a correct level. Too low and it does nothing; too high and it causes rampant unemployment. Set it at the right level and you can get some real benefits, but good luck figuring it out, considering that the right level changes from year to year, city to city, and industry to industry.
2) No matter how well you set it, it only impacts the bottom of the labour market.
A health labour market (including Northern European style unions) can help set wages intelligently, flexibly, and across all levels of the economy. The fact that unions (unlike the government) cannot just pick a number out of the air and enforce it by fiat is a key element of what makes it work.
- bumby 6y agoCan you define what you mean by a healthy labor market? I’ve seen effects of both good and bad unions, but struggle to define clear distinctions other than one appears much more corrupt