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The Pros And Cons Of Minimum Wage Laws

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In last year’s midterm elections there were a number of changes in minimum wage law, including the city of San Francisco voting to gradually increase its minimum wage to $15 by 2018. There have been a variety of reactions to these new minimum wage laws, even among economists who study the issue a great deal. The goal of the minimum wage, to help the poor, is something almost all economists can agree on. Whether or not minimum wage will actually help the people it is designed to help is another matter (accomplish its goal). The fact is that some labor markets benefit a great deal from such regulation and some are seriously hurt by it. In this article I will introduce the main argument for and against minimum wage, and then end with some synthesis of my own
Minimum Wage is Bad
The model that economists used for decades to evaluate minimum wage laws will be very familiar to anyone who has taken an introduction to economics course; it is none other than the classic supply and demand model. …show more content…

The market finds the marginal productivity of a class of laborers on its own as the supply and demand for their labor interact with each other. If someone’s marginal productivity were less than the wage rate, no employer would be willing to employ this person because they would lose money. If someone’s marginal productivity were more than their current wage, they could surely find another employer that would be willing to pay the higher wage for the higher productivity. These basic assumptions of the textbook model generally hold true. For the most part, the market does a great job at discovering what someone’s marginal productivity is, and assuring they get a fair

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15 Minimum Wage: Article Analysis

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1721 Words | 7 Pages

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567 Words | 3 Pages

The topic of minimum wage is one that can lead to heated debates from both sides of the aisle over how much a person should be getting in payment versus how much work they do, or how hard they work to earn the payment. Countless people today are not getting paid the amount they should be based off of the work that they are putting in to their job. There are arguments leaning towards the raising of minimum wage, and there are arguments leaning against the raising of the minimum wage, however one of the arguments I find persuasive. There are some arguments that lean towards the raising of the minimum wage. The first argument presented involves job creation in the United States.

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255 Words | 2 Pages

In the article “A $15-Hour Minimum Wage Could Harm America’s Poorest Workers”, Harry J. Holzer outlines the effects of a fifteen dollar federal minimum wage. He interprets statistical data from different credible analyses and thoroughly explains the meaning of each. The author also does a great job informing us the results from past federal minimum wage increases. He recognizes that jobs will inescapably be lost; therefore, many people will be unemployed. While some citizens believe that a $15 raise will help the economy, the author comprehends the negative consequences of any federal minimum wage increase on the economy.

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733 Words | 3 Pages

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305 Words | 2 Pages

Minimum Wage In this paper I wish to examine two different points of view on rising or not the minimum wage. Minimum wage, the lowest daily or monthly remuneration that employers may legally pay to workers. It was set for the first time in 1939 and varied with time. The most currently change has been made in July 2009 and people are willing changes to be done.

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551 Words | 3 Pages

Various arguments that have been put across for why the minimum wage should be increased will be explored. The research will provide an introduction to the issue with some historical background as well as the current dynamics surrounding the issue. After which, the direction of the paper will drive towards proving that the minimum wage should be increased by exploiting researched facts as well as evidence-based arguments that have been put forward by various experts concerning the issue. The paper will not include opposition arguments but it will focus on presenting a strong case as to why the wage should be increased as opposed to why it should not be increased or rather counter-arguing the facts presented by the other divide of the subject matter at hand. The research will use figures, numbers as well as other facts about the topic from previous research to build the case for increasing the

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636 Words | 3 Pages

Many politicians, business owners, and citizens hold fast to the belief that heightening the salary attached to minimum wage positions will yield negative benefits for our society. This opinion is supported by three vital view-points. The first can be found in the news article, “The Argument Against Raising Minimum Wage.” It expresses how the enlargement of this payment will take a toll on employment. The document reasons that if the amount of money employees earn is expanded, companies will be less likely to hire as many workers (Huppke).

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885 Words | 4 Pages

those who are responsible for the poverty many Americans live. The government must determine how much to increase the minimum wage; if they decide to increase it at all. Leading the struggle for increased minimum wages are the fast food workers of America, each with their own personal stories of struggle and reasons they must depend on a food service job, paying these meager wages, to provide for their family. As David Neumark states, “Since its enactment, there has been widespread debate about the merits of minimum wage laws, along with numerous efforts to evaluate their economic effects” (55). I seek to show the value of a significant minimum wage increase and the effects it will have, not only on fast food worker’s lives, but the good it could have on the US economy.

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981 Words | 4 Pages

In today’s society, it seems imperative to have an ensured income in order for members of a society to take care of those that depend on them. While raising the minimum wage may be the most potent means to this end, it is also the solution that brings the most long term problems. However, this has not stopped the policy from being tested in cities such as St. Louise and Seattle. While both had subtly different in both cities affects the broad end result: the policy was cancelled after a loss the employer’s money was apparent. These results prove that minimum wage would be inadvisable due to a loss to the workforce population, paradoxical effects, and the potential for a loss of money if an increased minimum wage is enforced.

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824 Words | 4 Pages

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745 Words | 3 Pages

Minimum wage laws affect a wide range of employees to different companies and industries but on a wider spectrum it also affects the market economy. Being such a polorized and controversial topic, people have different ideologies on minimum wage laws. In the 1990s Katz and Kreuger argued that minimum wage increases may have little to no effect on employment. Later in the 19th century John Bates Clark argued that his ethical marginal productivity theory was an attempt to show; that people should only be compensated for the labor they complete. The ways this affects the market economy say otherwise though.

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704 Words | 3 Pages

In the past three years, many politicians and labor unions have been pushing for an increase in minimum wage. Minimum wage is the lowest set wage by a law of a government body. An increase in minimum will benefit some people, and hurt others. An increase in minimum wage will cause benefit in the short run but will be very damaging to the economy in the long run. There should not be an increase in minimum wage because it is unhealthy to the economy in the long run and it will be the major cause of job loss, increase in inflation, competition, and the price level of goods and services.

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