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You're not considering 2nd order effects. The increased buying power is eventually corrected. Those on a salaried position have less buying power too because of
by throwaway3699 6y ago
You're not considering 2nd order effects. The increased buying power is eventually corrected. Those on a salaried position have less buying power too because of inflation. The whole economy is hurt by minimum wage increases, and the benefit they bring is temporary.
- CJefferson 6y agoYou make these negative claims about minimum wages with no evidence, while there is lots of high quality evidence that a minimum wage is positive or neutral.
- throwaway3699 6y agoThere's plenty of evidence. This is pretty much Econ 101. The minimum wage is basically a price control on the minimum cost of 1 unit of labour. If you increase the minimum wage, you're not increasing the value of the economy (which is what leads to the pie growing), but you force employers to spend more on the same thing. The pie is the same size but more money is going to minimum wage workers. The end result is inflation. People are not earning more, they are just getting a higher number every month. That being said, I do ack my own bias here, and I get there's reasonable arguments from both directions, all I can say is that it's my gut feeling based on experience: https://www.investopedia.com/ask/answers/052815/does-raising-minimum-wage-increase-inflation.asp https://www.investopedia.com/ask/answers/052815/does-raising...