3 ms·

In Sweden there's no minimum wage at all. We let the market set it.

by Yrlec 12y ago

UweSchmidt 12y ago
Nice. However there is an implicit minimum wage linked to welfare. Any wage must be above what welfare pays or people might not bother working at all.
- andreasklinger 12y ago
  Agree. Welfare is basic an implicit minimum wage. Also i personally believe that markets can only regulate themselves if all players start with the same conditions. Which they do more likely in sweden as they do in the states (eg. education, healthcare, middle class, etc)
- hershel 12y ago
  Do youmean that if someone doesn't want to work he can easily get welfare ?
  - UweSchmidt 12y ago
    Well, that reasoning was originally revealed to me by an economics professor, resolving the paradox "Germany supposedly has better welfare than the USA, why does Germany not have a minimum wage?" So basically, that line is 100% standard economic thinking and therefore can be best understood and accepted by making the usual assumptions: humans as rational actors with perfect information and the cognitive ability to weight options, striving to maximize self interest. https://en.wikipedia.org/wiki/Homo_economicus https://en.wikipedia.org/wiki/Homo_economicus If we're a a little more relaxed and maybe realistic with that assumption, we might find that it's a complex issue, with people's actions spanning a wide spectrum from "work? No thanks" to various levels of urgency, then desperation trying to find a new job and to make a living. Finally to people who'd be working hard even if unemployment benefits were 3x their wage, out of principle. Point is, there are other factors to look at than the minimum wage alone.
  - soneil 12y ago
    "doesn't want to" is an awkward way to look at it. It's more of a catch-22. If you simplify 'welfare' to "If you're not above the poverty line, you're entitled to assistance", then a job which does not bring you above the poverty line is zero-sum - you're still entitled to assistance. An example I see here quite often, is people who can only find part-time work, and still receive assistance. It's not unusual to find people in the position where they're working <20hrs/week, but do not want to work 20<n<30 hours a week because it'll interfere with their benefits. This is not the "don't want to work" trope - they'd take 40/hrs week in a heartbeat. But if 20hrs/week + benefits is better than 25hrs/week sans benefits, who would realistically take more work for less pay?
  - lotsofmangos 12y ago
    Here in the UK, most people who get welfare are also in work, so presumably there is a large tax saving to be had in raising the minimum wage.
mediascreen 12y ago
Well, we have extremely powerful unions that negotiate on the workers behalf and blockade companies that don't follow the collective agreements. We also have laws that let unions veto work visas for immigrants if they are not paid according to the collective agreements. This makes the de facto minimum wage something that is negotiated between the main unions and a few large employers' federations.

In Sweden there's no minimum wage at all. We let the market set it.

by Yrlec 12y ago

In Sweden there's no minimum wage at all. We let the market set it.

Nice. However there is an implicit minimum wage linked to welfare. Any wage must be above what welfare pays or people might not bother working at all.

andreasklinger 12y ago
Agree. Welfare is basic an implicit minimum wage. Also i personally believe that markets can only regulate themselves if all players start with the same conditions. Which they do more likely in sweden as they do in the states (eg. education, healthcare, middle class, etc)
hershel 12y ago
Do youmean that if someone doesn't want to work he can easily get welfare ?
- UweSchmidt 12y ago
  Well, that reasoning was originally revealed to me by an economics professor, resolving the paradox "Germany supposedly has better welfare than the USA, why does Germany not have a minimum wage?" So basically, that line is 100% standard economic thinking and therefore can be best understood and accepted by making the usual assumptions: humans as rational actors with perfect information and the cognitive ability to weight options, striving to maximize self interest. https://en.wikipedia.org/wiki/Homo_economicus https://en.wikipedia.org/wiki/Homo_economicus If we're a a little more relaxed and maybe realistic with that assumption, we might find that it's a complex issue, with people's actions spanning a wide spectrum from "work? No thanks" to various levels of urgency, then desperation trying to find a new job and to make a living. Finally to people who'd be working hard even if unemployment benefits were 3x their wage, out of principle. Point is, there are other factors to look at than the minimum wage alone.
- soneil 12y ago
  "doesn't want to" is an awkward way to look at it. It's more of a catch-22. If you simplify 'welfare' to "If you're not above the poverty line, you're entitled to assistance", then a job which does not bring you above the poverty line is zero-sum - you're still entitled to assistance. An example I see here quite often, is people who can only find part-time work, and still receive assistance. It's not unusual to find people in the position where they're working <20hrs/week, but do not want to work 20<n<30 hours a week because it'll interfere with their benefits. This is not the "don't want to work" trope - they'd take 40/hrs week in a heartbeat. But if 20hrs/week + benefits is better than 25hrs/week sans benefits, who would realistically take more work for less pay?
- lotsofmangos 12y ago
  Here in the UK, most people who get welfare are also in work, so presumably there is a large tax saving to be had in raising the minimum wage.

mediascreen 12y ago

Well, we have extremely powerful unions that negotiate on the workers behalf and blockade companies that don't follow the collective agreements. We also have laws that let unions veto work visas for immigrants if they are not paid according to the collective agreements. This makes the de facto minimum wage something that is negotiated between the main unions and a few large employers' federations.