Minimum Wage

[cordscords]

New video uploaded on youtube recently. Thought I would share it here.

http://www.youtube.com/watch?v=siW0YAAfX6I

[Neil Desmond]

Great video! Peter Schiff also did this a while ago on that issue:

[RonPaulforLife123]

I think the individual that explains minimum wage the best is Milton Friedman. In "Free to Choose," "Capitalism & Freedom" and his "Free to Choose" series he touches upon this policy. Thomas Sowell also talks about it in his many interviews and books.

Also, LearnLiberty published a video on the minimum wage and anyone who wants to learn about it should check the video out on YouTube. I can't post the link for some reason.

[Zippyjuan]

Most people are not effected by the national minimum wage- about two percent of hourly workers are paid it (though one reason for this is that there are several states which have higher minimum wage rates than the Federal one).

[Tpoints]

Most people are not effected by the national minimum wage- about two percent of hourly workers are paid it (though one reason for this is that there are several states which have higher minimum wage rates than the Federal one).

they might not be affected directly by it, but if the adjustment was great enough, would all wages be adjusted accordingly?

For example: if min wage was $5, and in a company you have people paid $5, 6, 10, 20. What if min wage was dropped to $3? Would you expect the wages to drop to $3, 5, 9, 18? Or, if the min wage was raised to $7, wouldn't you expect both $5 and $6 to turn into $7 and over $7 (as the person previously paid $1 more, would deserve slightly more than the min wage person to be fair)

[Steven Douglas]

For example: if min wage was $5, and in a company you have people paid $5, 6, 10, 20. What if min wage was dropped to $3? Would you expect the wages to drop to $3, 5, 9, 18? Or, if the min wage was raised to $7, wouldn't you expect both $5 and $6 to turn into $7 and over $7 (as the person previously paid $1 more, would deserve slightly more than the min wage person to be fair)

Why would you expect that? Absent any legislative forcing, it could be reckoned as "the amount the lowest paid employee earns". As such, a minimum wage (without regard to a legislated definition or mandate) is a floor only.

For example: if min wage was $5, and in a company you have people paid $5, 6, 10, 20. What if min wage was dropped to $3? Would you expect the wages to drop to $3, 5, 9, 18?

What kind of logic would even produce that possibility, since the wages of those earning more than the minimum (artificial OR natural) were not in any way derived from the minimum.

Or, if the min wage was raised to $7, wouldn't you expect both $5 and $6 to turn into $7 and over $7 (as the person previously paid $1 more, would deserve slightly more than the min wage person to be fair)

There is no "to be fair" about it. If an artificial minimum wage floor was raised to $7, the $5 and $6 would all become $7 (with some percentage laid off if those higher costs cannot be passed on). But who is at or above $7 at the time would not be in a worthless, meaningless "FAIRNESS" paradigm. Everything above $7 would be a free market negotiation between the employee and the firm who is under has no legal "price fixing" obligation with respect to wages.

[Seraphim]

Unfortunately this is not true. Since the minimum wage pushes many people out of a job, there is A LOT of productivity that is sacrificed. This means that everyone pays highers prices, essentially, across the board.

Less productivity = goods and services are more scarce. Scarcity drives prices up.

Most people are not effected by the national minimum wage- about two percent of hourly workers are paid it (though one reason for this is that there are several states which have higher minimum wage rates than the Federal one).

[Tpoints]

Why would you expect that? Absent any legislative forcing, it could be reckoned as "the amount the lowest paid employee earns". As such, a minimum wage (without regard to a legislated definition or mandate) is a floor only.



What kind of logic would even produce that possibility, since the wages of those earning more than the minimum (artificial OR natural) were not in any way derived from the minimum.




There is no "to be fair" about it. If an artificial minimum wage floor was raised to $7, the $5 and $6 would all become $7 (with some percentage laid off if those higher costs cannot be passed on). But who is at or above $7 at the time would not be in a worthless, meaningless "FAIRNESS" paradigm. Everything above $7 would be a free market negotiation between the employee and the firm who is under has no legal "price fixing" obligation with respect to wages.

they're not derived from the minimum? So you're basically saying if minimum wage was abolished, nobody would be affected but those who are paid minimum wage?

[Danan]

they're not derived from the minimum? So you're basically saying if minimum wage was abolished, nobody would be affected but those who are paid minimum wage?

Not even most of them would be affected. The people who would be affected the most, are the ones who are currently unemployed, because their marginal productivity is lower than the minimum wage rate. That's standard microeconomics 101.

That's the first google search illustrating minimum wage laws (and a really good one, imho):

[Tpoints]

Not even most of them would be affected. The people who would be affected the most, are the ones who are currently unemployed, because their marginal productivity is lower than the minimum wage rate. That's standard microeconomics 101.

That's the first google search illustrating minimum wage laws (and a really good one, imho):

are you saying, contrary to the common libertarian complaint that minimum wage laws "causes" unemployment, underemployment, and hurts an economy, it has almost no effect? Saying abolishing it would affect almost nobody is the same saying as having it affects almost nobody...right?