Selected responses to that blog post -
QED:
If the minimum hourly wage is raised by one cent, the effect on unemployment would be infinitesmal.
If we raise the minimum wage by fifty dollars, the effect would be massive unemployment.
The issue is precisely how much unemployment is an acceptable trade-off for increasing the hourly minimum. The problem is compounded by the difficulty in prognosticating.
In any event, if one's goal is to increase the income of poor people, the EIC is more efficient than the blunt force of a minimum wage.
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godfodder
...Some of you seem to have tacitly accepted a mental model wherein workers are somehow "prisoners" of their employers. As if, were there not a minimum wage, employers would be free to pay peanuts to everyone...
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Clayton E. Cramer (mail) (www):
Raising the minimum wage can either drive up prices, reduce profits, or force the employer to find ways to reduce costs to compensate (such as reducing workforce, improving efficiency, pressuring suppliers to lower costs) or some combination of the above. You can't really say for sure what the net effect will be without examining how competitive the market for a particular business is.
It is true that Wal-Mart supports raising the minimum wage. They have a lot of scrappy little competition still, businesses that don't have Wal-Mart's economies of scale, and can't afford a small reduction in profitability. Once again, the Democrats are screeching about the evil of Wal-Mart and how it is destroying the little guys--and then working with Wal-Mart on a policy that will destroy the little guys. No surprise, as usual.
It is certainly true that few minimum wage earners today will still be earning it in three years. It is also true that minimum wage earners are often teenagers who require so much supervision and guidance that employers lose money hirig them at $5.15 per hour. The hope is that within a few months, they will learn enough in the way of job skills to be worth their minimum wage and then some. Some don't, and get fired in their first month or two...
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