10-31-2005, 01:08 AM
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#39 (permalink)
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Human
Administrator
Location: Chicago
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Quote:
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Originally Posted by alansmithee
Again, neither of these statements disproves what I said, which was simply that raising the minimum wage lowers employment.
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Perhaps not, but I've already provided two sources that show it does not. A quick excerpt from the page at the Economic Policy Institute (the first of the two links I provided above):
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Despite the fact that contemporary economic research casts a long shadow of doubt on the contention that moderate minimum wage increases cause job losses, opponents still lead with this argument. This so-called “disemployment” argument is particularly difficult to maintain given two relatively recent developments in the history of minimum wages. First, the quality of empirical minimum wage research rose steeply over the last decade, due largely to economists’ ability to conduct pseudo-experiments3. Such experiments, rare in empirical economics, typically utilize the fact that numerous states (12 as of today) have raised their minimum wage above that of the federal level. This variation between states gives researchers a chance to isolate the impact of the wage change and test its impact on employment and other relevant outcomes. As stressed in the Card and Krueger book cited above, these studies reveal employment elasticities that hover about zero, i.e., they solidly reject the conventional hypothesis that any increase in the minimum wage leads to job losses among affected workers.
Second, following the most recent increase legislated in 1996, the low-wage labor market performed better than it had in decades.
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Recently, the Fiscal Policy Institute (FPI) released a study of the impact of higher minimum wages on small businesses4. Their analysis focuses on various outcomes for businesses with less than 50 employees, comparing these outcomes between states with minimum wages above the Federal level and those at the Federal level. If the theory that higher minimum wages hurt small businesses is correct, then we would expect there to be less growth in such enterprises in states with higher minimum wages. In fact ... the opposite is the case.
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Last edited by SecretMethod70; 10-31-2005 at 01:13 AM..
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