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When there is a decline, you say that it was from some other factor.
When there is not a decline, you disregard other factors.
It's not possible in real-life examples to separate out the effect of the minimum wage from all the other things that affect the economy. But we know for sure, as a mathematical certainty that is proven beyond any shadow of a doubt that raising the minimum wage costs jobs.
Well, if there is mathematical certainty (which I am sure you can share with us)....
Real life is what matters. Yes, there are other things which effect the economy and since raising minimum wage in the past has not led to job losses, then the minimum wage effect must not be very large on the overall economy.It's not possible in real-life examples to separate out the effect of the minimum wage from all the other things that affect the economy
Sticking with the year chosen earlier of 1995, there were 125 million people employed. http://www.dlt.ri.gov/lmi/laus/us/usadj.htm If two percent were paid the Federal Minimum wage, that means that applied to 2.5 million of them. Many minimum wage jobs are part time but some may be full time. I will figure an even 30 hours a week worked on average for them. Adding one dollar an hour costs $30 a week to an employer. Is that a lot of money? That will depend on his margins. Let's figure 50 weeks a year (two weeks off also to keep numbers simple). $30 a week is $1,500 a year more (before taxes).
So what is the impact on the overall economy? GDP in 1995 was $7.7 trillion (about half what it is today) and 2.5 million minimum wage workers times $1500 a year is $3.75 billion (which is now a bigger number) comes out to 0.05% of GDP.
Last edited by Zippyjuan; 04-20-2015 at 01:04 PM.
It depends on elasticity- the slope of the lines for demand for labor and supply of labor. If demand is inelastic, changes in prices (for labor or anything else) do not lead to changes in demand. If elasticity is high, then small changes in price can lead to large changes in demand.
which is impossible to measure. Remember also that while higher labor costs may mean fewer jobs offered by some employers, the higher wages people get also leads to more spending on goods meaning higher demand and need for more labor to produce those additional goods. Or if an employer is able to pass along the higher labor costs to his customers, he may not decrease his workforce (in total hours or total numbers of workers). There is no absolute "this will lead to fewer jobs".There has never been an instance where raising the minimum wage didn't result in job losses compared to what the employment level would have been if the minimum wage weren't raised.
A ten percent hike in the minimum wage does not lead to an automatic ten percent decline in minimum wage jobs. As you said earlier, once you move to the real economy and out of the classroom, there are many other factors also at work.
Last edited by Zippyjuan; 04-20-2015 at 02:52 PM.
Not "by" but "to". http://fightfor15.org/april15/
Ah.
Thought you meant increases of $5 an hour up to a $15 an hour increase. Sorry. (Fed minimum wage is only $7.25 currently so I assumed an increase of those amounts since raising it $5 would not get it to $15).But you gotta be kidding if you think a raise for $5 to $15 as liberals are demanding will have no effect on employment.
Last edited by Zippyjuan; 04-20-2015 at 03:35 PM.
We can get rid of the minimum wage once the Border is sealed and the rent seeking 14th amendment corporate person is abolished. Good idea also to eliminate rent seeking law/regulation in the professions- especially medicine and law.
More like your words rather than other words, at least with the border (I don't know what he means elsewhere). The border guards are not actually on the border. They are at internal roadblocks up to 100 miles inside the border. I have documented on this forum how roadblocks are ineffective. I documented how Richard Stana of the DHS said the goal is to secure 30% of illegal activity at the border, leaving 70% unsecured.
So, your more government is actually people getting their head out of their ass and doing some real work. That would amount to less government.
I don't even care about this issue, but anyway, you're a fake libertarian on this site just trying to troll. Your love of big government is also well documented. If any new members want more detail, then just let me know. PRB's posting speaks for itself, but there are other gems he's posted.
Disrupt, Deny, Deflate. Read the RPF trolls' playbook here (post #3): http://www.ronpaulforums.com/showthr...eptive-members
If anybody is interested in PRB's misdeeds, then just let me know. He and I have discussed this at length, so I am only addressing other members here. Thanks.
Disrupt, Deny, Deflate. Read the RPF trolls' playbook here (post #3): http://www.ronpaulforums.com/showthr...eptive-members
In other words, you won't answer my questions, because you can't. You can only fool people (most likely in private) where I can't respond and hope that people will buy your lies.
I ask you time and time again to provide evidence, the best you can do is accuse me of lying because I didn't tell you about muh gunz. I asked you to prove I am a liberal, Democrat, Jew, paid shill, fake libertarian, and the best evidence you can cook up are
1. I didn't tell you about muh gunz
2. I said in a conversation that I belittle people (not always, not everybody)
3. I admit that sometimes I troll
I didn't ask you about my "misdeeds" I asked you what basis you have for calling me a fake libertarian and other names you are so fond of.
Disrupt, Deny, Deflate. Read the RPF trolls' playbook here (post #3): http://www.ronpaulforums.com/showthr...eptive-members
Ok, let me volunteer (since I do have an affinity for voluntaryism )
Libertarianism, like any label out there isn't always easy to pin down since there are even socialists like Chomsky who call themselves Libertarian(-socialist) but nonetheless, since I've seen PRB sneak in liberal agenda into the discussion on more than one occasion (although I'll also concede that I've seen him defend "libertarian" positions a couple of times as well), I'm curious to know what other generally "anti-freedom" ideas he espouses.
Honestly, I don't know if he's an anti-liberty troll or not but I think if a person has defended a view on one occasion & opposed the same view on another occasion, within a fairly short space of time, then I think it's highly likely that such an individual isn't genuine & could very likely be a troll.
There is enormous inertia — a tyranny of the status quo — in private and especially governmental arrangements. Only a crisis — actual or perceived — produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable
- Milton Friedman
DO quote which occasion. Please, thanks.
What's a good example, you're not a liar or child molester like NorthCarolinaLiberty, so I expect you to know the answer.(although I'll also concede that I've seen him defend "libertarian" positions a couple of times as well), I'm curious to know what other generally "anti-freedom" ideas he espouses.
Honestly, I don't know if he's an anti-liberty troll or not but I think if a person has defended a view on one occasion & opposed the same view on another occasion, within a fairly short space of time, then I think it's highly likely that such an individual isn't genuine & could very likely be a troll.
There is enormous inertia — a tyranny of the status quo — in private and especially governmental arrangements. Only a crisis — actual or perceived — produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable
- Milton Friedman
Disrupt, Deny, Deflate. Read the RPF trolls' playbook here (post #3): http://www.ronpaulforums.com/showthr...eptive-members
I apologize, I read that to say you were accusing me of "if a person has defended a view on one occasion & opposed the same view on another occasion, within a fairly short space of time, then I think it's highly likely that such an individual isn't genuine & could very likely be a troll."
So anyway, back to the thread and the people who are here to legitimately discuss it. Plus rep to the OP. I like the simplicity of the circular drawing and other diagrams.
If there are any other legit or non-lying people who'd like to discuss, then I'd like to hear. I even welcome opposing viewpoints, as long as they're genuine.
Disrupt, Deny, Deflate. Read the RPF trolls' playbook here (post #3): http://www.ronpaulforums.com/showthr...eptive-members
This is actually been a proven fact. I can point you to several well known academic studies that demonstrate this. Granted the effect is on the margins for a just binding minimum wage (small increase) rather than a strictly binding in which these effects become more pronounced.
Still the results have been statistically significant.
Slutter McGee
You are right. Change in Employment = Change in Hiring Rate - Change in Separation Rate. With increases in the MW the separation rate drops along with the hiring rate, so on the aggregate there is usually only a small decrease in employment...some studies say not at all. But there are still negative effects. Job creation rate does drop, Businesses substitute away from teenage labor, but not to adult labor...rather to teenage labor with a lower marginal utility of a dollar and a higher marginal product. In other words they substitute away from poor kids to middle class kids who are better educated.
It also hurts small businesses with lower turnover far more. High turnover business can decrease the marginal expense of hiring new workers as turnover slows and actually increase employment.
I realize that all these effects are on the margins. On the aggregate you are right about a small increase. But you still can't ignore that they are real effects.
Slutter McGee
I agree with what you said before about increases in MW affecting others above MW. But this situation might actually not affect employment. Across the board increase in wages is going to affect prices the same way. You are talking about a situation where Keynesian theory would probably hold true.
Sorry, to keep posting one after another. I am late to this, and just going down the thread responding to what I see. Far easier than trying to combine a bunch of posts.
Slutter McGee
Pretty much what everyone thought until the mid 90's. Even after factoring in the fact that Employment is relatively inelastic. Most estimates are around .125 but I have seen them go as high as .3. So you are looking at a 1 to 3% decrease in employment for every 10% increase if that holds true. The classical model doesn't really show this when modeled.
Basically you are completely correct for large increase in the MW, but it simply doesn't hold true for small increases.
Slutter McGee
Everybody being paid more won't affect employment??
Keynesian or not, across the board increases WILL affect prices AND employment, I don't know what you're disagreeing about.Across the board increase in wages is going to affect prices the same way. You are talking about a situation where Keynesian theory would probably hold true.
Prices sure, but you are talking about a 1 time increase in the money supply dolled out to EVERYONE equally. Not going to really effect employment. Inflation and wages adjust in the long run.
Of course there is going to be negative effects, but in your scenario Prices are not going to be sticky. You are not looking at a huge decrease in employment. Now just increasing the Minimum Wage way up...sure. absolutely you are right. But not with accross the board increases in wages.
Slutter McGee
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