[tw8f969ae5b6f4]

It seems to me that those taking the position that the minimum wage should be lowered/abolished and those taking the opposite position are both accepting the premise that absent the minimum wage, wages would fall. Is there any real-world basis for that premise?

From basic supply and demand:

1. a downward pressure on wages emerges from workers competing with workers (competition among suppliers of labor)

2. an upward pressure on wages emerges from employers competing with employers (competition among consumers of labor)

And, ceteris paribus, some equilibrium wages emerge.

The minimum wage ostensibly exists to interfere with #1 (though usually framed as protecting workers from employers), assuming the minimum wage is set above the would-be equilibrium wage.

But what if the minimum wage is set below the would-be equilibrium wage? Perhaps the minimum wage instead serves to interfere with #2 by allowing a point of collusion among employers, and thereby keep wages artificially low.

Is anyone aware of any research on this?

[conanbatt]

If min wage restriction is put below the market rate, it will have no effect. I think they are called called non-bounding limits in micro-econ