| My objection to the parent post is the notion that a business which can't pay a living wage shouldn't be in business. It insinuates that businesses should be responsible for paying a living wage out of some sense of it being morally right, which is ignorant of how economics operates. Wanting people to be able to meet basic needs and have some financial security is, I believe, universally desirable. Please do think that I don't want this as well. To expect it to come via altruism is idealistic. > Are you suggesting that minimum wages are bad because it sets a minimum for employers to pay as though without a minimum wage they would pay a rate more in line with value? Yes, that's basically what I'm saying. Most literature focuses on people being priced out of the labor market (see https://www.cato.org/policy-analysis/negative-effects-minimu..., for one such analysis). I'm also suggesting there could be other effects due to loss of agency over one's labor price, similar to how collusion of employers to fix wages harms employees. Maybe someone has studied it, maybe not. >If folks earning a minimum wage today, in a world with a minimum wage, can't afford basic living expenses, would you expect more people to afford basic living expenses without a minimum wage? Ultimately prices are fluid based on what people can afford, especially so for local markets like housing. If minimum wages increase one would expect increased housing prices as those prices were set in line with what people could afford. If they make more, now they can afford to pay more. If you were making marginally above minimum wage you now also want an increase to protect your increased buying power. W.E. Upjohn Institute for Employment Research found that modest minimum wage increases have minimal affect on prices increases while larger ones can create price increases. This makes intuitive sense, based on market theory.
https://research.upjohn.org/cgi/viewcontent.cgi?referer=&htt... |