[bko]

You don't know what the definitive predictable identical outcome would be. But you know the effect at the margin.

At the margin, a wage floor will prevent some percent of transactions that would have taken place if a wage floor was not in place. It's not complicated. Some people will benefit, sure, but some commerce just won't take place.

Consider a price floor on selling a used car. Suppose you had a car to sell. Would it make you feel better if there were a law that prevents you from selling your car for less than some amount? Sure maybe without the floor, your car would have sold for less than the floor amount. But would you want a price floor as a seller of a car? How about as a buyer of a car?

Chances are if your car is worth less than the floor, no one will buy your car now. The price floor doesn't magically make your car more valuable, just makes it harder to sell.

[jfengel]

You don't actually know that. It's too simple a model. Real world data on minimum wages do not bear it out.

There are more variables than the graphs you get in the first two weeks of Econ 101. If you make it to the end of the semester, or even to the midterm, you'll know that the simple predictions you got on the first quiz were false.

[mchusma]

I think it does bear that out in general, although it is slightly more complicated. What seems to happen 1. Low-wage workers, as a collective group, experience an increase in earnings (Dube & Zipperer, 2024). 2. Total job losses do take place, but are minor and teens/part-time/new entrants workers lose more often (Belman & Wolfson, 2014; Redmond & McGuinness, 2024). 3. Lost hours & increased prices - businesses primarily absorb the cost by slightly reducing weekly hours worked & increasing prices for consumers (Redmond & McGuinness, 2024)

I would agree that modest minimum wage increases are far from the worst thing the government does, compared to other government interventions.

[stuaxo]

There's commerce not taking place when wages are too low as well.

Wages don't make up all the costs so we can't say that increasing wages increases prices by the same percentage either.