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A minimum wage is the lowest hourly, daily or monthly wage that employers may legally pay to employees or workers. First enacted in Australia and New Zealand in the late nineteenth century,[1] minimum wage laws are now in force in more than 90% of all countries.[2] Image File history File links Scale_of_justice_2. ... Companies law is the field of law concerning business and other organizations. ... For other uses, see Corporation (disambiguation). ... Look up company in Wiktionary, the free dictionary. ... A partnership is a type of business entity in which partners (owners) share with each other the profits or losses of the business undertaking in which all have invested. ... This article needs to be wikified. ... A limited partnership is a form of partnership similar to a general partnership, except that in addition to one or more general partners (GPs), there are one or more limited partners (LPs). ... 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Civil procedure is the body of law that sets out the process that courts will follow when hearing cases of a civil nature (a civil action, as opposed to a criminal action). ... A wage is a compensation which workers receive in exchange for their labor. ...


Many supporters of the minimum wage assert that it is a matter of ethics and social justice that helps reduce exploitation and ensures workers can afford what are considered to be basic necessities.[1] Most American economists' opinions of the minimum wage tend to be less favorable. A survey in 2006 by Robert Whaples polled 'PhD' members of the American Economic Association. He, found that respondants were nearly split on whether an increase in the minimum wage would help or hurt small business.[3] Social justice refers to the concept of an unjust society that refers to more than just the administration of laws. ... Exploitation means many different things. ... Face-to-face trading interactions on the New York Stock Exchange trading floor. ... The American Economic Association, or AEA, is the oldest and most important professional organization in the field of economics. ...

Contents

Minimum wage law

Main article: Minimum wage law

Minimum wage laws vary greatly across many different jurisdictions, not only in setting a particular amount of money (e.g. US$5.85 per hour under U.S. Federal law, or £5.52 (for those aged 22+) in the United Kingdom), but also in terms of which pay period (e.g. Russia and China set monthly minimums) or the scope of coverage. For instance, not all workers may be paid a full minimum wage, because exceptions may be made for teenagers or those under 21. Some jurisdictions allow employers to count tips given to their workers as credit towards the minimum wage level. A minimum wage is the lowest hourly, daily or monthly wage that employers may legally pay to employees or workers. ... USD redirects here. ... For details of notes and coins, see British coinage and British banknotes. ...


North America

Under the Constitution of Canada the responsibility for enacting and enforcing labour laws including minimum wages in Canada rests with the ten provinces, the three territories also having been granted this power by virtue of federal legislation. ... History of the federal minimum wage in real and nominal dollars. ...

Australia & New Zealand

Australia


Australia's minimum wage system has it's origins in the 'Harvester Judgment' of 1907. The Harvester Judgment (1907) 2 CAR 1 was delivered in the Australian Commonwealth Court of Conciliation and Arbitration by H.B. Higgins in 1907. ...


A 2005 study found that the Australian federal minimum wage was 58% of the median wage, compared to 45% in the UK and 34% in the USA.[4] The typical minimum wage worker is in a middle-income household.[5] Motto: (traditional) In God We Trust (official, 1956–present) Anthem: The Star-Spangled Banner Capital Washington, D.C. Largest city New York City Official language(s) None at the federal level; English de facto Government Federal Republic  - President George W. Bush (R)  - Vice President Dick Cheney (R) Independence - Declared - Recognized...


In Australia, on 14 December 2005, the Australian Fair Pay Commission was established under the Workplace Relations Amendment (WorkChoices) Act 2005. It is the responsibility of the commission to adjust the standard federal minimum wage[6], replacing the role of the Australian Industrial Relations Commission that took submissions from a variety of sources to determine appropriate minimum wages. As of 2007, an unskilled labourer earns $13.74 per hour or $522.12 per week.[7] is the 348th day of the year (349th in leap years) in the Gregorian calendar. ... Year 2005 (MMV) was a common year starting on Saturday (link displays full calendar) of the Gregorian calendar. ... The Australian Fair Pay Commission (AFPC) is an Australian legislative body created under the Chaser Governments WorkChoices industrial relations law in 2006 to set the minimum rate of pay for workers. ... WorkChoices, or the Workplace Relations Act 1996 as amended by the Workplace Relations Amendment (Workchoices) Act 2005, came into effect in March 2006. ...


New Zealand


In New Zealand the Government has decided to raise the minimum wage and abolish the youth wage (16 - 17 years olds) from April 1, 2008. The minimum wage will rise from $11.25 to $12 per hour. That’s $96 for an eight hour day, or $480 for a 40 hour week.


From 1 April 2008, the training wage will rise to $9.60 an hour before tax. That’s $76.80 for an eight hour day, and $384 for a 40 hour week. The training wage applies to people doing recognised industry training involving at least 60 credits a year.


Economics of the minimum wage

Economic theory analyzes the effects of minimum wages within the context of labor markets (c.f. labor economics). In a labor market, workers supply their labor, which is sold for wages, and employers demand labor. Labour economics seeks to understand the functioning of the market for labour. ...


The neoclassical economic argument views the labor market as perfectly competitive. In perfectly competitive markets, the market price settles to the marginal value of the product. Therefore, under the perfect competition assumption, in the absence of a minimum wage, workers are paid their marginal value. As is the case with all (binding) price floors above the equilibrium, minimum wage laws are predicted to result in more people being willing to offer their labor for hire, but fewer employers wishing to hire labor. The result is a surplus of labor, or, in this case, unemployment. Price of market balance In economics, economic equilibrium is simply a state of the world where economic forces are balanced and in the abscence of external shocks the (equilibrium) values of economic variables will not change. ... Surplus means the quantity left over, after conducting an activity; the quantity which has not been used up, and can refer to: budget surplus, the opposite of a budget deficit economic surplus Surplus product or surplus value in Marxian economics physical surplus in the economic theory of Piero Sraffa Operating... CIA figures for world unemployment rates, 2006 Unemployment is the state in which a person is without work, available to work, and is currently seeking work. ...


Supply of labor curve

The amount of labor that workers supply is generally considered to be positively related to the nominal wage. Economists graph this relationship with the wage on the vertical axis and the quantity of labor supplied on the horizontal axis. The supply of labor curve then is upward sloping, and is shown as a line moving up and to the right.


The upward sloping labor supply curve results from the fact that, as wages rise, people in the labor force are incented to spend less time in leisure and more time working while people outside the labor force are incented to join the labor force. As wages rise, the cost of spending time in leisure and the cost of not being a labor force participant rises.


Demand for labor curve

The amount of labor demanded by firms is generally assumed to be negatively related to the nominal wage; as wages increase, firms demand less labor. As with the supply of labor curve, this relationship is often depicted on a graph with wages represented on the vertical axis, and the quantity of labor demanded on the horizontal axis. The demand for labor curve is downward sloping, and is depicted as a line moving down and to the right on a graph.


A firm's cost is a function of the wage rate. As the wage rate rises, it becomes more expensive for firms to hire workers and so firms hire fewer workers.


Supply and demand for labour

Graph of Labor Market

Combining the demand and supply curves for labor allows us to examine the effect of a minimum wage. We will start by assuming that the supply and demand curves for labor will not change as a result of raising the minimum wage. This may be an incorrect assumption since jobs this low on the demand curve may be so integral to a business' function that they will not simply disappear because the business has to pay more to hire people for those positions.


The point at which the demand for labor curve and the supply of labor curve intersect is the labor market equilibrium. At the equilibrium, the number of people seeking jobs (the quantity supplied of labor) equals the number of jobs available (the quantity demanded of labor). If the wage rate rises above the equilibrium wage as shown in this chart, then the number of people seeking jobs would seem to exceed the number of jobs available. If the number of jobs is thus negatively affected, there would be fewer jobs available, and would theoretically lead to unemployment. Hence, in the absence of government intervention, competition among workers for the limited number of jobs would cause wages to fall until the wage rate reached the equilibrium. A minimum wage prevents wages from falling.


Standard theory criticism

Gary Fields, Professor of Labor Economics and Economics at Cornell University, argues that the standard "textbook model" for the minimum wage is "ambiguous", and that the standard theoretical arguments incorrectly measure only a one-sector market. Fields says a two-sector market, where "the self-employed, service workers, and farm workers are typically excluded from minimum-wage coverage… [and with] one sector with minimum-wage coverage and the other without it [and possible mobility between the two]," is the basis for better analysis. Through this model, Fields shows the typical theoretical argument to be ambiguous and says "the predictions derived from the textbook model definitely do not carry over to the two-sector case. Therefore, since a non-covered sector exists nearly everywhere, the predictions of the textbook model simply cannot be relied on."[8] Cornell redirects here. ...


An alternate view of the labor market has low-wage labor markets characterized as monopsonistic competition wherein buyers (employers) have significantly more market power than do sellers (workers). Such a case is a type of market failure and results in workers being paid less than their marginal value. Under the monopsonistic assumption, an appropriately set minimum wage could increase both wages and employment, with the optimal level being equal to the marginal productivity of labor.[9] This view emphasizes the role of minimum wages as a market regulation policy akin to antitrust policies, as opposed to an illusory "free lunch" for low-wage workers. Detractors[who?] point out that no collusion between employers to keep wages low has ever been demonstrated, asserting that in most labor markets, demand meets supply, and it is only minimum wage laws and other market interference which cause the imbalance. However collusion is not a pre-requisite for market power; segmented markets, information costs, imperfect mobility and the 'personal' element of labor markets all represent movements away from the idealized perfectly competitive labor market. In economics, a monopsony is a market with only one buyer in the market, often an input market. ... In economics, market power is the ability of a firm to alter the market price of a good or service. ... Market failure is a term used by economists to describe the condition where the allocation of goods and services by a market is not efficient. ... A wage is the amount of money paid for some specified quantity of labour. ... This article is about work. ... Marginal revenue productivity theory of wages is a neoclassical model that determines, under some conditions, the optimal number of workers to employee at an exogenously determined market wage rate. ... A regulated market is the provision of goods or services that is regulated by a government appointed body. ... This article is about anti-competitive business behavior. ... TANSTAAFL is an acronym for the adage There Aint No Such Thing As A Free Lunch, popularized by science fiction writer Robert A. Heinlein and promulgated in his 1966 novel The Moon is a Harsh Mistress, a libertarian utopia. ... Look up collusion in Wiktionary, the free dictionary. ... The supply and demand model describes how prices vary as a result of a balance between product availability at each price (supply) and the desires of those with purchasing power at each price (demand). ...


Debate

Support

Supporters of the minimum wage claim it has these effects:

  • Helps small businesses as well as big businesses.[10]
  • Increases the standard of living for the poorest and most vulnerable class in society and raises average.[11]
  • Motivates and encourages employee to work harder. (Contrast with welfare transfer payments.)[12]
  • Does not have budget consequence on government. "Neither taxes nor public sector borrowing requirements rise." (Contrast with negative income taxes such as the EITC.)[12]
  • Minimum wage is administratively simple; workers only need to report violations of wages less than minimum, minimizing a need for a large enforcement agency.[12]
  • Stimulates consumption, by putting more money in the hands of low-income people who spend their entire paychecks.[11]
  • Increases the work ethic of those who earn very little, as employers demand more return from the higher cost of hiring these employees.[11]
  • Decreases the cost of government social welfare programs by increasing incomes for the lowest-paid.[11]
  • Does not have a substantial effect on unemployment compared to most other economic factors [13], and so does not put any extra pressure on welfare systems.
  • Businesses' annual and average payrolls grow faster.[10]
  • Employment grows more quickly when minimum wage is increased.[10]
Opposition

Opponents of the minimum wage claim it has these effects: The United States federal Earned Income Tax Credit (EITC) is a refundable tax credit that reduces or eliminates the taxes that low-income married or single working people pay (such as payroll taxes) and also frequently operates as a wage subsidy for low-income workers. ... Work ethic is a set of values based on the moral virtues of hard work and diligence. ...

  • Hurts small business more than large business. [14][15]
  • Lowers competitiveness[16]
  • Reduces quantity demanded of workers. This may manifest itself through a reduction in the number of hours worked by individuals, or through a reduction in the number of jobs.[17][18]
  • Reduces profit margins of business owners employing minimum wage workers, thus encouraging a move to businesses that do not employ low-skill workers.[citation needed][19]
  • Businesses try to compensate for the decrease in profit by simply raising the prices of the goods being sold thus causing inflation and increasing the costs of goods and services produced. [20][21]
  • Increases prices for customers of employers of minimum wage workers, which would pass through to the general price level,[22] which disproportionately affects the prices that poor people pay for goods and services.[23]
  • Does not improve the situation of those in poverty. "Will have only negative effects on the distribution of economic justice. Minimum-wage legislation, by its very nature, benefits some at the expense of the least experienced, least productive, and poorest workers."[24]
  • Is a limit on the freedom of both employers and employees. Minimum wage laws make it illegal for employers to pay workers less than the minimum wage. This also prevents workers from being made to provide labor or services for less than the minimum. For example, during the apartheid era in South Africa, white trade unions lobbied for the introduction of minimum wage laws so as to exclude black workers from the labor market. By preventing black workers from selling their labor for less than white workers, the black workers were prevented from competing for jobs held by whites.[25]
  • Businesses spend less on training their employees.[23]
  • Is less effective than the Earned Income Tax Credit at targeting the truly needy, and is more damaging to businesses.[23]
  • Reduces economic growth by skewing factor-choice incentives away from the optimum choice.[26]
  • Increase in underemployment.[27]
  • Decreases human capital by encouraging people to enter the job market instead of pursuing further education.[23]
  • Hurts the least employable by making them unemployable, in effect pricing them out of the market.[28]
  • Excludes low cost competitors from labour markets, hampers firms in reducing wage costs during trade downturns (etc.), generates various industrial-economic inefficiencies as well as unemployment, poverty, and price rises, and generally dysfunctions as basically a special form of political-economic protectionism – the equivalent or analogue of such things as tariff barriers to low cost imports.[29]

Profit margin is a measure of profitability. ... A boy from Jakarta, Indonesia shows his find. ... Social justice refers to conceptions of a just society, where justice refers to more than just the administration of laws. ... For the legal definition of apartheid, see the crime of apartheid. ... The United States federal Earned Income Tax Credit (EITC) is a refundable tax credit that reduces or eliminates the taxes that low-income married or single working people pay (such as payroll taxes) and also frequently operates as a wage subsidy for low-income workers. ... World GDP/capita changed very little for most of human history before the industrial revolution. ... In economics, the term underemployment has at least three different distinct meanings and applications. ... Human capital refers to the stock of productive skills and technical knowledge embodied in labor. ...

Debate over consequences

Equivalence to a tax and subsidy

As argued by former Council of Economic Advisors Chairman Gregory Mankiw, a minimum wage is equivalent to: The Council of Economic Advisers is a group of economists set up to advise the President of the United States. ... Categories: Stub | 1958 births | Economists ...

  1. A wage subsidy for unskilled workers, paid for by
  2. A tax on employers who hire unskilled workers.[30]

The first part of the policy provides some benefit to low wage workers while the second part creates more unemployment among low wage workers. This is why the minimum wage is often criticized as a self-contradictory policy. Others argue the small decrease in employment is offset by the increased benefit to workers.


Empirical studies

A classical economics analysis of supply and demand implies that by mandating a price floor above the equilibrium wage, minimum wage laws should cause unemployment. This is because a greater number of workers are willing to work at the higher wage while a smaller numbers of jobs will be available at the higher wage. Companies can be more selective in those whom they employ thus the least skilled and inexperienced will typically be excluded. Image File history File links Download high-resolution version (880x695, 16 KB) Antony Davies (self), www. ... Classical economics is widely regarded as the first modern school of economic thought. ...


However, there are many other variables that can complicate the issue such as monopsony in the labour market, whereby the individual employer has some market power in determining wages paid. Thus it is at least theoretically possible that the minimum wage may boost employment. Though single employer market power is unlikely to exist in most labour markets in the sense of the traditional 'company town,' asymmetric information, imperfect mobility, and the 'personal' element of the labour transaction give some degree of wage-setting power to most firms. In economics, a monopsony (from Ancient Greek μόνος (monos) single + ὀψωνία (opsōnia) purchase) is a market form with only one buyer, called monopsonist, facing many sellers. ... A company town is a town or city in which most or all real estate, buildings (both residential and commercial), utilities, hospitals, small businesses such as grocery stores and gas stations, and other necessities or luxuries of life within its borders are owned by a single company. ...


Economists disagree as to the measurable impact of minimum wages in the 'real world'. This disagreement usually takes the form of competing empirical tests of the elasticities of demand and supply in labor markets and the degree to which markets differ from the efficiency that models of perfect competition predict.


A 2000 survey by Dan Fuller and Doris Geide-Stevenson reports that of a sample of 308 American Economic Association economists, 45.6% fully agreed with the statement, "a minimum wage increases unemployment among young and unskilled workers", 27.9% agreed with provisos, and 26.5% disagreed. The authors of this study also reweighted data from a 1990 sample to show that at that time 62.4% of academic economists agreed with the statement above, while 19.5% agreed with provisos and 17.5% disagreed.[33] The American Economic Association, or AEA, is the oldest and most important professional organization in the field of economics. ...


A similar survey in 2006 by Robert Whaples polled PhD members of the American Economic Association. Whaples found that 37.7% of respondants supported an increase in the minimum wage while 46.8% wanted it completely eliminated.[3] The American Economic Association, or AEA, is the oldest and most important professional organization in the field of economics. ...


In the debate about minimum wage it is rarely mentioned by how much the quantity of labor demanded may fall if the minimum wage is raised. Research papers by the Employment Policies Institute[34] and by the National Center for Policy Analysis[35] claim that increases of 10% in the minimum wage may reduce demand hours worked at the minimum wage by around 1% or 2% depending on circumstances. The National Center for Policy Analysis (NCPA) is a non-partisan, non-profit think tank that develops and promotes private alternatives to government regulation and control, solving problems by relying on the strength of the competitive, entrepreneurial private sector. ...


Some research suggests that the unemployment effects of small minimum wage increases are dominated by other factors. [5] In Florida, where voters approved an increase in 2004, a follow-up comprehensive study confirms a strong economy with increased employment above previous years in Florida and better than in the U.S. as a whole. : “The Florida Minimum Wage After One Year.” http://www.risep-fiu.org/reports/Florida_Minimum_Wage_Report.pdf


According to a claim by the Mackinac Center for Public Policy[36], the passage of the first Federal mandated minimum wage in the United States in 1938 led to an estimated 500,000 blacks losing their jobs via replacement by higher skilled and more educated white laborers. Milton Friedman, 1976 Nobel Prize winner in Economics, called the minimum wage one of the most "anti-negro laws" for what he saw as its adverse effect on black employment.[37] The Mackinac Center for Public Policy is a nonprofit free-market research and educational organization located in Midland, Michigan. ... Milton Friedman (July 31, 1912 – November 16, 2006) was an American Nobel Laureate economist and public intellectual. ...


Today, the International Labour Organization (ILO)[2] and the OECD[13] do not consider that the minimum wage can be directly linked to unemployment in countries which have suffered job losses. Although strongly opposed by both the business community and the Conservative Party when introduced in 1999, the minimum wage introduced in the UK is no longer controversial and the Conservatives reversed their opposition in 2000.[38] A review of its effects found no discernible impact on pay levels.[39] The International Labour Organization (ILO) is a specialized agency of the United Nations that deals with labour issues. ... The Organization for Economic Co-operation and Development (OECD) is an international organization of those developed countries that accept the principles of representative democracy and a free market economy. ... The Conservative Party, officially though less commonly known as the Conservative and Unionist Party, is a political party in the United Kingdom. ...

Analysis Source Comparison Prop. Effects on Wage Prop Effects on Employment
New Jersey vs. Pennsylvania New Jersey MW Increased to $5.05 April 1992 Fast Food Joints Across States 0.11* 0.04
Texas Fast Food Joints FED MW increased to $4.25 April 1991 High- and Low-Wage Restaurants 0.08* 0.2*
California Teenagers California MW increase to $4.25 July 1988 Teenagers in California 0.1* 0.12
Teenagers Across States Fed MW increase to $4.25 1989 - 92 Cross States 0.08* 0.00
Low Wage Workers Across States FED MW increase to $4.25 Across States 0.07* 0.02

MW - Minimum Wage FED - Federal

  • indicates significance at 5%

Card and Krueger

The laws of demand and supply predict that an increase in the minimum wage will reduce employment.


In 1992, the Minimum wage in New Jersey increased by 18% while the adjacent state of Pennsylvania remained at $4.25. Card & Krueger gathered information on fast food restaurants that lay very close to the borders of Pennsylvania and New Jersey in an attempt to see what this effect had on employment within New Jersey. Classical economic would have concluded that relative employment should have decreased in New Jersey. Card and Krueger asked employers whether they intended to lay off workers in response to the increased minimum wage. Based on the employers' responses, the authors concluded that the increase in the minimum wage had no significant impact on employers' intentions to lay off employees.


The more common debate is on changes to minimum wages. This unified view was challenged by research done by David Card and Alan Krueger. In their 1997 book Myth and Measurement: The New Economics of the Minimum Wage (ISBN 0-691-04823-1), they argued the negative employment effects of minimum wage laws to be minimal if not non-existent (at least for the United States). For example, they look at the 1992 increase in New Jersey's minimum wage, the 1988 rise in California's minimum wage, and the 1990-91 increases in the federal minimum wage. They assume that the demand for low-wage workers is inelastic. Noteworthy is that these results do not refute the theory underlying the prediction that a minimum wage reduces employment. Rather, the results suggest that the effect predicted by the theory may, in some instances, be small enough as to be statistically zero. Economist David Card David Card is a labor economist and professor at the University of California, Berkeley. ... Alan B. Krueger (born September 17, 1960) is an economist, Bendheim Professor of Economics and Public Affairs at Princeton University and Research Associate at the National Bureau of Economic Research. ... In economics, elasticity is the ratio of the proportionate change in one variable with respect to proportional change in another variable, such as the responsiveness of the price of a commodity to changes in market demand or visa-versa. ...


Critics, however, argue that their research was flawed.[40] For example, Card and Krueger gathered their data by telephoning employers in Pennsylvania and New Jersey, asking them whether they intended to increase, decrease, or make no change in their employment. Subsequent attempts to verify the claims requested payroll cards from employers to verify employment, and found that the minimum wage increases were followed by decreases in employment. On the other hand, an assessment of data collected and analyzed by David Neumark and William Wascher did not initially contradict the Card/Krueger results,[41] but in a later edited version they found that the same general sample set did increase unemployment. The 18.8% wage hike resulted in "[statistically] insignificant—although almost always negative" employment effects.[42]


Another possible explanation for why the current minimum wage laws may not affect unemployment in the United States is that the minimum wage is set close to the equilibrium point for low and unskilled workers. Thus absent the minimum wage law unskilled workers would be paid approximately the same amount. However, an increase above this equilibrium point could likely bring about increased unemployment for the low and unskilled workers.


Reaction to Card and Krueger

Since the introduction of a national minimum wage in the UK in 1999, its effects on employment were subject to extensive research and observation by the Low Pay Commission. The Low Pay Commission found that, rather than make employees redundant, employers have reduced their rate of hiring, reduced staff hours, increased prices, and have found ways to cause current workers to be more productive (especially service companies).[43] Neither trade unions nor employer organizations contest the minimum wage, although the latter had especially done so heavily until 1999.


Some leading economists such as Greg Mankiw and Paul Krugman, do not accept the Card/Krueger results,[44] while many leading economists accept the Card/Krueger results,[45][46] The Joint Economic Committee of the United States Congress has been critical of Card and Krueger's work. They note that it conflicts with other studies done on minimum wage laws within the United States over the past 50 years.[47] According to the JEC, minimum wage laws have been shown to cause large amounts of unemployment, especially among low-income, unskilled, black, and teenaged populations, as well as cause a host of other mal-effects, such as higher turnover, less training, and fewer fringe benefits. The Joint Economic Committee is one of only four joint committees of the U.S. Congress. ... Type Bicameral Houses Senate House of Representatives President of the Senate President pro tempore Dick Cheney, (R) since January 20, 2001 Robert C. Byrd, (D) since January 4, 2007 Speaker of the House Nancy Pelosi, (D) since January 4, 2007 Members 535 plus 4 Delegates and 1 Resident Commissioner Political... CIA figures for world unemployment rates, 2006 Unemployment is the state in which a person is without work, available to work, and is currently seeking work. ... Poverty is the state of being without, often associated with need, hardship and lack of resources across a wide range of circumstance. ... A separate article is about the punk band called The Adolescents. ... This article or section does not cite any references or sources. ... Training refers to the acquisition of knowledge, skills, and competencies as a result of the teaching of vocational or practical skills and knowledge that relates to specific useful skills. ...


According to economists Donald Deere (Texas A&M), Kevin Murphy (University of Chicago), and Finis Weltch (Texas A&M), Card and Krueger's conclusions are contradicted by "common sense and past research". Texas A&M University at College Station Texas A&M University, often Texas A&M, A&M or TAMU for short, is one of the flagship universities of Texas, and is the flagship institution of the Texas A&M University System. ... For other uses, see University of Chicago (disambiguation). ...


They conclude that:[48]

Each of the four studies examines a different piece of the minimum wage/employment relationship. Three of them consider a single state, and two of them look at only a handful of firms in one industry. From these isolated findings Card and Krueger paint a big picture wherein increased minimum wages do not decrease, and may increase, employment. Our view is that there is something wrong with this picture. Artificial increases in the price of unskilled laborers inevitably lead to their reduced employment; the conventional wisdom remains intact.

Minimum wage alternatives

Some critics of the minimum wage argue that a negative income tax or earned income tax credit benefits a broader population of low wage earners, and society as a whole bears the cost. In this view, this is more economically efficient because a low tax rate on the broader economy causes less deadweight loss than a high tax rate on a small section of the economy. The ability of the earned income tax credit to deliver a larger monetary benefit to poor workers at a lower cost to society was recently documented in a report by the Congressional Budget Office.[6] In economics, a negative income tax (abbreviated NIT) is a method of tax reform that has been discussed among economists but never fully implemented. ... The United States federal Earned Income Tax Credit (EITC) is a refundable tax credit that reduces or eliminates the taxes that low-income married or single working people pay (such as payroll taxes) and also frequently operates as a wage subsidy for low-income workers. ... In economics, a deadweight loss (also known as excess burden) is a permanent loss of well being to society that can occur when equilibrium for a good or service is not Pareto optimal, (that at least one individual could be made better off without others being made worse off). ... Taxes redirects here. ... The United States federal Earned Income Tax Credit (EITC) is a refundable tax credit that reduces or eliminates the taxes that low-income married or single working people pay (such as payroll taxes) and also frequently operates as a wage subsidy for low-income workers. ... The Congressional Budget Office is a federal agency within the legislative branch of the United States government. ...


Lewis F. Abbott argues that employing companies are economic organizations not charities or welfare agencies and that national minimum wage fixing is a comparatively inefficient, costly, and dysfunctional method of raising the living standards of poorer households. It is much more practical and cost-effective for governments to seek to: The Standard of living refers to the quality and quantity of goods and services available to people. ...

  • maximize opportunities for work at whatever the going market rate for jobs (although virtually all full-time jobs pay more than the dole-money alternative, and even comparatively low-grade jobs offer valuable work experience and opportunities for advancement, etc.).
  • save money in other areas -- e.g., cut purely social status-based welfare benefit payments to persons who do not require them, reduce monetary inflation, and remove various artificial political additions to basic living costs which necessitate income subsidies in the first place (e.g. regressive indirect taxes, tariffs on cheap food and clothing imports, and dear housing policies).[49]

This article is about work. ... The United States federal Earned Income Tax Credit (EITC) is a refundable tax credit that reduces or eliminates the taxes that low-income married or single working people pay (such as payroll taxes) and also frequently operates as a wage subsidy for low-income workers. ... Welfare has several meanings: Welfare, the good fortune, health, happiness, prosperity, etc. ... An indirect tax (such as sales tax, value added tax (VAT), or goods and services tax (GST)) is collected from the person who bears the tax by intermediaries and the proceeds passed on to government. ... A tariff is a tax placed on imported and/or exported goods, sometimes called a customs duty. ... Houses in Fishpool Street, St Albans, England For other meanings of the word house, see House (disambiguation). ...

See also

This is a list of all 30 Days episodes. ... Garcia v. ... Guaranteed minimum income (GMI) is a proposed system of social welfare provision that guarantees that all citizens or families have an income sufficient to live on, provided they meet certain conditions. ... Labour economics seeks to understand the functioning of the market for labour. ... This article is in need of attention. ... See also List of minimum wage laws. ... Minimum Wage by State after July 25, 2007 States with minimum wage rates higher than the Federal minimum wage  States with minimum wage rates equal to the Federal minimum wage  States with no minimum wage law  States with minimum wage rates lower than the Federal minimum wage History of federal... Under the Constitution of Canada the responsibility for enacting and enforcing labour laws including minimum wages in Canada rests with the ten provinces, the three territories also having been granted this power by virtue of federal legislation. ... Living wage refers to the minimum hourly wage necessary for a person to achieve a basic standard of living. ... A maximum wage is a state enforced limit on how much income an individual can earn. ... Cover of the 2001 Metropolitan Books edition Nickel and Dimed: On (Not) Getting By in America is a book authored by Barbara Ehrenreich. ... A Positive right is a right, either moral or decreed by law, to be provided with something so that it is incumbent upon another to act, as opposed to a negative right which is a right to not be subject to the action of another. ... Wage slavery is a term expressing disapproval of a condition where a person is compelled to work in return for payment of a wage. ...

References

  1. ^ a b American Academy of Political and Social Science. "The Cost of Living." Philadelphia, 1913.
  2. ^ a b ILO 2006: Minimum wages policy (PDF)
  3. ^ a b Robert Whaples (2006) "Do Economists Agree on Anything? Yes!," The Economists' Voice: Vol. 3 : Iss. 9, Article 1.
  4. ^ Leigh, Andrew (2005). "Does raising the minimum wage help the poor?". Discussion Paper No. 501. Australian National University Centre for Economic Policy Research. Retrieved on 2006-05-11.
  5. ^ Leigh, Andrew (2005). "Does raising the minimum wage help the poor?". Discussion Paper No. 501. Australian National University Centre for Economic Policy Research. Retrieved on 2006-05-11.
  6. ^ fairpay.gov.au - About the Commission. Australian Fair Pay Commission. Retrieved on 2007-07-05.
  7. ^ Executive Summary July 2007 (PDF). Australian Fair Pay Commission. Retrieved on 2007-11-27.
  8. ^ Gary Fields (1994). "The Unemployment Effects of Minimum Wages". International Journal of Manpower. Retrieved on 2007-02-12.
  9. ^ Manning, Alan (2003). Monopsony in motion: Imperfect Competition in Labor Markets. Princeton, NJ: Princeton University Press. ISBN 0691113122. 
  10. ^ a b c http://www.epi.org/content.cfm/webfeatures_viewpoints_raising_minimum_wage_2004
  11. ^ a b c d http://www.epi.org/content.cfm/issueguides_minwage Real Value of the Minimum Wage
  12. ^ a b c Richard B. Freeman (1994). "Minimum Wages – Again!". International Journal of Manpower. Retrieved on 2007-02-12.
  13. ^ a b OECD (2006): OECD Employment Outlook 2006 (read-only PDF)
  14. ^ Wal-Mart Warms to the State - Mises Institute
  15. ^ Eliminating Small Business
  16. ^ Wal-Mart's Perverse Strategy on the Minimum Wage
  17. ^ Tupy, Marian L. Minimum Interference, National Review Online, May 14, 2004
  18. ^ "The Wages of Politics", Wall Street Journal. 
  19. ^ Offshoring High-Tech and Professional Jobs
  20. ^ Increasing the Mandated Minimum Wage: Who Pays the Price?
  21. ^ Why Wal-Mart Matters - Mises Institute
  22. ^ Aaronson, D. and E. French, 2006. Output Prices and the Minimum Wage. Employment Policies Institute.
  23. ^ a b c d A blunt instrument, The Economist, October 26, 2006 (English)
  24. ^ (Cato)
  25. ^ Williams, Walter (1989). South Africa's War Against Capitalism. New York: Praeger. ISBN 027593179X. 
  26. ^ Keiner, Morris; Kudrle, Robert (2000). "Does Regulation Affect Economic Outcomes? The Case of Dentistry". Journal of Law and Economics 43: 548-582. doi:10.2139/ssrn.202391. 
  27. ^ Wilson, Lilla. "How About a Real Minimum Wage Increase?", New York Times, 1989-11-17. Retrieved on 2008-02-24. 
  28. ^ (Cato)
  29. ^ Lewis. F. Abbott, Statutory Minimum Wage Controls: A Critical Review of their Effects on Labour Markets, Employment, and Incomes. Industrial Systems Research Publications, Manchester UK, 2nd. edn. 2000. ISBN 978-0-906321-22-5.[1]
  30. ^ Greg Mankiw's Blog: Working at Cross Purposes
  31. ^ Statistical Abstract of the United States, Bureau of Labor Statistics [2]
  32. ^ U.S. Department of Labor, Employment Standards Administration [3]
  33. ^ Fuller, Dan; Geide-Stevenson, Doris (2003). "Consensus Among Economists: Revisited". Journal of Economic Review 34 (4): 369-387. 
  34. ^ "The Effect of Minimum Wage Increases on Retail and Small Business Employment", Employment Policies Institute, May 2006. 
  35. ^ "Minimum Wage Teen-age Job Killer", NATIONAL CENTER FOR POLICY ANALYSIS, May 20, 1999. 
  36. ^ "Great Myths of the Great Depression (page 10)", Mackinac Center for Public Policy, April 22, 2006. 
  37. ^ http://video.google.com/videoplay?docid=6813529239937418232&q=label%3Afree+market Milton Friedman Exposes The "Unholy Coalition" of Minimum Wage Supporters
  38. ^ National Minimum Wage. politics.co.uk. Retrieved on 2009-12-29.
  39. ^ Metcalf, David (April 2007). Why Has the British National Minimum Wage Had Little or No Impact on Employment?.
  40. ^ "Myth and Measurement: The New Economics of the Minimum Wage", Cato Institute, April 22, 2006. 
  41. ^ http://www.epinet.org/briefingpapers/minimumw_bp_1996.pdf
  42. ^ Neumark & Wascher, American Economic Review, Volume 90 No. 5.
  43. ^ Low Pay Commission (2005). National Minimum Wage - Low Pay Commission Report 2005
  44. ^ Greg Mankiw. Krugman on the Minimum Wage
  45. ^ Joseph Stiglitz. Employment, social justice and societal well-being, International Labour Review, 141 (1-2), p. 9 - 29.
  46. ^ Economic Policy Institute. Hundreds of Leading Economists Say: Raise the Minimum Wage
  47. ^ 50 Years of Research on the Minimum Wage
  48. ^ Sense and Nonsense on the Minimum Wage
  49. ^ Lewis. F. Abbott, Statutory Minimum Wage Controls: A Critical Review of their Effects on Labour Markets, Employment, and Incomes. Industrial Systems Research Publications, Manchester UK, 2nd. edn. 2000. Chapter 7: "The Effects of Minimum Wage Controls on Incomes and Welfare". ISBN 978-0-906321-22-5.[4]

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External links

Dollars & Sense is a magazine dedicated to providing left-wing perspectives on economics. ... This article is about work. ... Recruitment refers to the process of finding possible candidates for a job or function, usually undertaken by recruiters. ... A cover letter or covering letter is a letter of introduction attached to, or accompanying another document such as a résumé or curriculum vitae. ... An employment contract is an agreement entered into between an employer and an employee at the commencement of the period of employment and stating the exact nature of their business relationship, specifically what compensation the employee will receive in exchange for specific work performed. ... An independent contractor is a person or business which provides goods or services to another entity under terms specified in a contract. ... Job Interview is a process in which a potential employee is evaluated by an employer for prospective employment in their company, organization, or firm. ... Look up résumé, curriculum vitae, resume in Wiktionary, the free dictionary. ... A full time job usually has benefits (such as health insurance) and are often considered careers. ... A part-time job carries less hours per week than a full-time job, and usually pays less than a full-time job. ... A permatemp is an employee whose status is somewhere between a temporary employee and a permanent employee. ... Self-employment is the individual pursuit of capitalism. ... Temporary Work or Temporary Employment refers to a situation where the employee is expected to leave the employer within a certain period of time. ... This article does not cite any references or sources. ... For other uses, see Volunteer (disambiguation). ... This article or section is not written in the formal tone expected of an encyclopedia article. ... Sick leave (or sickness pay or sick pay) is an employee benefit in the form of paid leave which can be taken during periods of sickness. ... Workers compensation (colloquially known as workers comp in North American English or compo in Australia) provides insurance to cover medical care and compensation for employees who are injured in the course of employment, in exchange for mandatory relinquishment of the employees right to sue his or her employer for... Flextime (or flexitime Flexi-time) is a variable work schedule, in contrast to traditional work arrangements requiring employees to work a standard 9am to 5pm day. ... Overtime is the amount of time someone works beyond normal working hours; these may be determined in several ways, by custom (what is considered healthy or reasonable by society), by practices of a given trade or profession, by legislation, or by agreement between employers and workers or their representatives. ... It has been suggested that Nomad Workers be merged into this article or section. ... A wage is a compensation which workers receive in exchange for their labor. ... Living wage refers to the minimum hourly wage necessary for a person to achieve a basic standard of living. ... A maximum wage is a state enforced limit on how much income an individual can earn. ... Look up Leave in Wiktionary, the free dictionary. ... An employee handbook (or employee manual) details guidelines, expectations and procedures of a business or company to its employees. ... Sexual harassment is harassment or unwelcome attention of a sexual nature. ... Fired and Firing redirect here. ... The examples and perspective in this article or section may not represent a worldwide view. ... In employment law, constructive dismissal is where an employee resigns due to their employers behaviour. ... An individual can face termination of employment, or job loss, for one of many reasons. ... Layoff is the termination of employment of an employee or (more commonly) a group of employees for business reasons, such as the decision that certain positions are no longer necessary. ... A letter of resignation (or a resignation letter) is a type of letter written by an employee to his or her employer to officially announce their resignation from the current position that they hold. ... A resignation is the formal act of giving up ones office or position. ... Retirement is the point where a person stops employment completely. ... A severance package is pay and benefits an employee receives when they leave employment at a company. ... CIA figures for world unemployment rates, 2006 Unemployment is the state in which a person is without work, available to work, and is currently seeking work. ... Wrongful dismissal is an idiom and legal phrase, describing a situation in which an employees contract of employment has been terminated by the employer in circumstances where the termination breaches one or more terms of the contract of employment, or a statute provision in employment law. ...

  Results from FactBites:
 
U.S. Minimum Wage History (309 words)
The minimum wage increases in three $0.70 increments--to $5.85 in 2007, $6.55 in mid 2008, and to $7.25 in mid 2009.
Minimum wages have never been sufficient to raise a family out of poverty, if only one member of the family works.
The minimum wage has varied from a maximum of 90% of the poverty level in 1968 and has been between 53 and 62% since 1985.
Minimum wage - Wikipedia, the free encyclopedia (4010 words)
Minimum wage jobs rarely include health insurance coverage (as noted here and here), although that is changing in some parts of the USA where the cost of living is high, such as California, and at some companies.
A minimum wage is usually different from the lowest wage determined by the forces of supply and demand in a free market, and therefore acts as a price floor, but it's not necessarily a living wage.
Minimum wage laws have been shown to cause large amounts of unemployment, especially among low-income, unskilled, fl, and teenaged populations, as well as cause a host of other mal-effects, such as higher turnover, less training, and fewer fringe-benefits.
  More results at FactBites »

 
 

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