The Minimum Wage Essay -- Minimum Wage Research Paper

The stripped-down wage is something that F.D.R. put in place a long time ago during the Great Depression. I dont think it worked then. It didnt function any problems then and it hasnt solved any problems in 50 years.-- rump RaeseFor many years it has been a matter of conventional wisdom among economists that the borderline wage causes fewer jobs to exist than would be the case without it. This is simply a matter of price theory, taught in every economics textbook, requiring no epicurean analysis to justify. Were this non the case, there would be no logical reason why the lower limit wage could not be set at $10, $100, or $1 million per hour. Historically, defenders of the minimal wage have not disputed the dis-employment effects of the minimum wage, but argued that on balance the operative poor were better off. In other words, the higher(prenominal) incomes of those with jobs offset the disdain incomes of those without jobs, as a result of the minimum wage l levitan. Now, c hairwoman Obama is advancing the novel economic theory that modest increases in the minimum wage will have no impact whatsoever on employment. This proposition is based entirely on the work of three economists David waggle and Alan Krueger of Princeton, and Lawrence Katz of Harvard. Their studies of increases in the minimum wage in California, Texas and New Jersey on the face of it found no loss of jobs among fast food restaurants that were surveyed before and afterward the increase l card-92b, l krueger, and l katz. While it is not insofar clear why Card, Katz and Krueger got the results that they did, it is clear that their findings are directly contrary to nearly every empirical study ever done on the minimum wage. These studies were exhaustively surveyed by the stripped-down Wage Study Commission, which concluded that a 10% increase in the minimum wage reduced jejune employment by 1% to 3%. The following survey of the academician research on the minimum wage is designed to give nonspecialists a sense of just how isolated the Card, Krueger and Katz studies are. It will also indicate that the minimum wage has wide-ranging negative effects that go beyond unemployment. For example, higher minimum wages encourage employers to cut back on training, thusly depriving low wage workers of an important means of long-term advancement, in government issue for a small increase in current income. For many workers this is a very ... ...g (1996), Who Gets What from borderline Wage Hikes, Industrial and Labor Relations follow-up 49 (April) 547-52.------, and T. A. Finegan (1989), The Minimum Wage and the Poor The End of a Relationship, journal of Policy Analysis and Management 8 (Winter) 53-71.23wCard, D., and A. Krueger (1995), Myth and Measurement (Princeton, N.J. Princeton University Press).Deere, D., K. M. spud and F. Welch (1995), Employment and the 1990-1991 Minimum Wage Hike, American Economic Review paper and Proceedings 85 (May) 232-37. Gramlich, E. (1976), Impact of Minimum Wages on early(a) Wages, Employment, and Family Incomes, Brookings Papers on Economic Activity 2 409-51.Lang, K. (1994), The Effect of Minimum Wage Laws on the Distribution of Employment Theory and Evidence, Working Paper, capital of Massachusetts University.Neumark, D., and W. Wascher (1995), The Effects of Minimum Wages on Teenage Employment and adjustment Evidence from Matched CPS Surveys, NBER Working Paper No. 5092, April.Smith, R., and B. Vavrichek (1992), The Wage Mobility of Minimum Wage Workers, Industrial and Labor Relations Review 46 (October) 82-88.