[tomasien]

I just can't stress this enough: if you're reading an economics article that relies on anecdotes from owners in the service industry, DO NOT READ IT!

You can find a service industry business owner to shit on literally anything local government does. If there aren't hard numbers in the piece, into the trash it goes.

In the city where I grew up, they implemented a Bus Rapid Transit system that has definitively helped the businesses on its corridor. However, from the moment it was announced, article after article would come out where business owners would blame the BRT for their declining business or even failure. The evidence never backed these claims up.

The case that the minimum wage hurts the service industry, in particular, makes sense to me. In fact, I'm sure it's somewhat true. However, when the best an article can do is a 2018 survey saying that the majority of businesses have increased prices (curiously - no numbers about any negative impact on their bottom lines) - toss it in the garbage. No thanks.

[jeromegv]

In Toronto they did something wonderful. DATA. When they implemented transit priority on a previously more car-centric road, of course you had some small business owners screaming murder, saying their sales were down like crazy (we heard 30-40%) and wanted compensation. Majority of business actually supported the new project because it was about bringing more people total (more people fits in transit than would fit on a parking lot).

Turns out that the city had a partnership with the credit card processors to measure the change in spending before and after the implementation of the project (on a aggregate level for all the shops on that street). Surprise surprise, a year later, they were able to prove there was no drop in business. We never heard again from those business, and surprise, they are still open.

[maaaats]

Same in Norway just this year. Removing lots of cars from the city centre, people complaining, then the data shows it was not really an issue.

[tomasien]

Yeah there's tons of data on this, it's essentially not controversial if you care about data/what's real. Cars destroy business in every city in the world where they're dominant.

[tomasien]

That rules. There are lots - LOTS! - of local regulations that hurt small businesses. But they're not all headline grabbers and they're certainly not all ideological battlegrounds like the minimum wage.

We actually have a lot of data on this stuff and we should use it :)

[duxup]

Yeah the vision of "local business guy says" doesn't seem all that useful.

A local business group supported some transit options in my area. I thought that was nice until I realized that they only supported politicians who wanted to cut state spending across the board. So of course no transit project...

After ten years of lobbying they finally got their transit projects.... from the opposite party. You would think they learned something but they haven't changed.

I'm really skeptical about "what local business guy thinks" type information and if they even really know what is in their best interest all the time.

[tomasien]

There is an audience for "minimum wage kills jobs" articles and you can't write an article without a source. It's sad but true that the majority of the service industry is in perpetual failure mode, therefore, you can always find multiple business owners (they're "experts" right?) who will blame their failure on whatever the latest bogey man is.

Again - I genuinely believe hyper-local minimum wage hikes are especially stressful to the service industry. But articles like this make me almost more skeptical of that belief, because if this is the best they can do to make the case.....

[duxup]

Yeah one of the more prominent local "too many taxes" guys who loved to put up makeshift billboards around his restaurant about taxes was recently arrested. He was a fixture on local news always ready to give a quote.

Turns out he wasn't paying his taxes, or employees at times... ;)

Granted plenty of local business guys who certainly can have those opinions and they pay their taxes.

[greedo]

Ignore what he says, but pay attention to what he does. If the article is truthful, some employers are lowering their operating costs by either cutting hours or terminating employees; others are raising prices of their products. The former is bad for employment, the latter for customers. As prices elevate, they approach the marginal value of eating out. Eating out is very elastic, so if the prices rise too high, the companies could fail, causing more unemployment.

It's a fine line. My personal opinion is that minimum wage was never meant to be a living wage, but more for entry level, part time jobs for teenagers etc. If we raise the minimum wage to a level that provides a living wage (assuming 40 hour work week), then it becomes complicated since a lot of jobs are part time. To earn a living wage, someone would have to have multiple jobs, which generally sucks if you work in the food industry. It's a complicated problem, with lots of legacy baggage and viewpoints. Providing a living wage sounds great, but I think there's lots of issues when you're dealing with transient employees who don't want to work full time, don't have many skills, etc.

[tomasien]

The only stat they cite is that some employers are raising prices. There are no other stats cited - only anecdotes.

In the ideal pro-minimum-wage world, prices go up slightly but the impact on those who get the minimum wage bump is bigger than the impact on those people from price changes OR the impact on other people for those price changes.

That's the tradeoff pro-min-wage people would expect and want so if that's happening, no news there.

The tradeoff they would not want would be massive hours cuts, businesses going out of business (although some would want that - not me!), or this turning into an excuse for the businesses to cut costs and/or automate. We would need data of some kind to understand if that's happening.

[duxup]

>Ignore what he says, but pay attention to what he does.

That still requires interpretation.

Someone does X, is it because of Y or Z? Or something else?

[greedo]

I wasn't really focusing on causation so much. People say a lot of things about who/what they are and what they value. But what they do is really a better determinant of that than what they say.

[coldtea]

>I just can't stress this enough: if you're reading an economics article that relies on anecdotes from owners in the service industry, DO NOT READ IT!

And similarly, if you find an economics article (or paper) that relies on statistics, and general principles, DO NOT READ IT!

Generally, avoid economics as a source of market insight altogether...