Yes, raising the minimum wage would help, but part of the problem is that when the very poor start working, they're no longer eligible to all kinds of subsidies

Yes, raising the minimum wage would help, but part of the problem is that when the very poor start working, they're no longer eligible to all kinds of subsidies (food stamps, medicaid). Greg Mankiw explains it very well here: http://gregmankiw.blogspot.nl/2009/11/poverty-trap.html http://gregmankiw.blogspot.nl/2009/11/poverty-trap.html