What price minimum wage?

[brendan]

Maybe you have misinterpreted my statement that
"Unemployment is just a statistic"

It fails to recognise that people who are employed may very well be in a similar position to people who are theoretically considered employed.

Then what's your point? How does that even come close to justifying a minimum wage? If there are efficiency gains to a firm from paying above market wages, then what need is there for a minimum wage?

[costargh]

To act as a safety net.

[Eriny]

Just a theory here, but isn't it possible that minimum wage increases are linked with a higher percentage of unemployed people because working becomes more attractive and the participation rate rises?

I don't get the point of this. You might have to clarify.

Well, unemployment rate = people actively looking for a job divided by people looking for a job plus people who have a job. Therefore, if more people are looking for a job but the same amount of people have a job, there will be a rise in the percentage of people recorded to be unemployed. And I imagine that more people would be looking for a job if the minimum wage was higher because there is the extra incentive of bringing home more money for doing the same work.

I still think that government intervention works. Obviously it can't go too far overboard but I don't think it is at the moment. People can still negotiate wages quite freely whilst not being in danger of exploitation. I'll explain more about this later if the mood strikes me, I'm not thinking very clearly ATM :|

Somehow I feel though, that debating the point is absolutely futile, lol. It's just different perspectives, neither is really right or wrong, but I'm personally glad that I live in a society that instills the minimum wage, showing that empathy for all individuals is valued, even those with no marketable skills to speak of (for whater reason that may be).

[Mao]

employers need employees just as employees need to get paid

if you are an important resource to the employer, he/she will do everything within their reasonable power to keep you, that is why you get pay rise from bargaining
if you are just another mindless procedural worker, then so be it, u can only work to your potential, and you dont deserve any more than what you get offered, if you dont like it, then jump the boat and get a better job (and if you cant, that's really your problem)

that is my view, however unfair and cruel it is, such is life

there is no need to raise the "safety net" any higher than it is now, how is it fair on the skilled workers to be paid little more on those who arent as skilled?

[brendan]

No, it is not just unemployment, minimum wages also create disemployment effects: http://papers.nber.org/papers/w12663

I haven't denied that... why have you posted that link for the 5th time...

1. Why not?
2. Here is why:

Give me a figure or estimate from that data of what the unemployment levels would be at without minimum wages. I can say with a great deal of certainty (based on common sense) that it would not be a significant difference.

To artificially increase wages is a different story. If the market wage is lower than the proposed minimum wage, then the government-enforced price floor will lead to cuts in employment because the government has ramped up wages beyond what the current level of demand commands.

But the minimum wage is already so low that that is not a problem. Economic theory is a lot different to its practical implementation.

[costargh]

but I'm personally glad that I live in a society that instills the minimum wage, showing that empathy for all individuals is valued, even those with no marketable skills to speak of (for whater reason that may be).

Agree

[Collin Li]

Unemployment rates increasing as a result of minimum wage are a bad thing, aren't they?

Eriny, it's not as simple as you believe. Those who have no marketable skills to speak of, will simply not be offered a job. The minimum wage does not act as a safety net for these individuals, they merely lock them out of jobs!

[brendan]

To act as a safety net.

That's the thing, you well-intentioned - I will give you that. But good intentions aren't good enough. The fact is that the minimum wage hurts the poor and most disadvantaged in our society - the very people it was intended to benefit.

[Collin Li]

employers need employees just as employees need to get paid

if you are an important resource to the employer, he/she will do everything within their reasonable power to keep you, that is why you get pay rise from bargaining
if you are just another mindless procedural worker, then so be it, u can only work to your potential, and you dont deserve any more than what you get offered, if you dont like it, then jump the boat and get a better job (and if you cant, that's really your problem)

that is my view, however unfair and cruel it is, such is life

there is no need to raise the "safety net" any higher than it is now, how is it fair on the skilled workers to be paid little more on those who arent as skilled?

Wow, I never would have suspected: Mao the Communist doesn't agree with minimum wages. just kidding mate.

[costargh]

No, it is not just unemployment, minimum wages also create disemployment effects: http://papers.nber.org/papers/w12663

I haven't denied that... why have you posted that link for the 5th time...

1. Why not?
2. Here is why:

Give me a figure or estimate from that data of what the unemployment levels would be at without minimum wages. I can say with a great deal of certainty (based on common sense) that it would not be a significant difference.

To artificially increase wages is a different story. If the market wage is lower than the proposed minimum wage, then the government-enforced price floor will lead to cuts in employment because the government has ramped up wages beyond what the current level of demand commands.

But the minimum wage is already so low that that is not a problem. Economic theory is a lot different to its practical implementation.

I said give me a figure not give me a website in which you expect me to crawl through and find some information which you can't guarentee is actually there.

[brendan]

but I'm personally glad that I live in a society that instills the minimum wage, showing that empathy for all individuals is valued, even those with no marketable skills to speak of (for whater reason that may be).

If i was an employer, who is to say that I would still hire that very person after you institute a minimum wage? I am not obliged to hire people if I don't think it is worth it.

[Collin Li]

To act as a safety net.

That's the thing, you well-intentioned - I will give you that. But good intentions aren't good enough. The fact is that the minimum wage hurts the poor and most disadvantaged in our society - the very people it was intended to benefit.

This is crucial, and I was going to state this, but I forgot.

Good intentions will not save this world. Compassion and empathy are great, but it should be done voluntarily. There are perverse and unintended consequences with government intervention, regardless of their good intentions.

[Mao]

I said give me a figure not give me a website in which you expect me to crawl through and find some information which you can't guarentee is actually there.

i'm sorry costa, but i sense a strawman here....

and @ coblin: i'm not as communist as u think !!!

[Collin Li]

I said give me a figure not give me a website in which you expect me to crawl through and find some information which you can't guarentee is actually there.

i'm sorry costa, but i sense a strawman here....

Tsk tsk tsk, I haven't taught you anything. That's not a straw-man, although it is laziness. Well actually, I'm not sure who should be picking out the information for who, but I say this debate is getting too hostile between brendan and costargh. If costargh wanted that, he should have plainly stated that from the beginning, or just calmly said so.

[brendan]

I said give me a figure not give me a website in which you expect me to crawl through and find some information which you can't guarentee is actually there.

Like you said i've give you the link like 4 times or more. The conclusions of the study were:

1. among the papers we view as providing the most credible evidence, almost all point to negative employment effects, both for the United States as well as for many other countries.
2. very few - if any - studies that provide convincing evidence of positive employment effects of minimum wages, especially from those studies that focus on the broader groups (rather than a narrow industry) for which the competitive model predicts disemployment effects.
3. the studies that focus on the least-skilled groups provide relatively overwhelming evidence of stronger disemployment effects for these groups.