Minimum wage rise [is] a compromise of supply, demand
Let's see:
- Policy is supposed to be effective, agree? (Otherwise, what's the point of making a policy?)
- Now, for a minimum wage policy. What is 'effective'? Effective minimum wage is when wage can not go lower than that, agree?
- What is 'compromise' between supply and demand? It is a situation where supply meets the demand (or demand meets the supply, whatever), no? Economists call it 'equilibrium'.
- Now, if supply and demand meet, is there any excess? No. Because if there is, it is not an equilibrium. Not a 'compromise'.
- So, in order to be effective, a minimum wage should be higher than equilibrium wage. That means, it should be such that an excess supply is in effect.
- In other words, the title of the news is at best, misleading.
More coffee, please?
Econ Fallacy
You want more coffee? Free or paid? Free coffee, pls ask directly to the owner to make it. Paid coffee, cost you $1 for me to make it but the seat and the coffee are complimentary from the owner.
ReplyDeleteIt is misleading. Excess workers supply is kind of excessive happiness of employers in getting cheap workers.
are we on JP now?
ReplyDeletewe need a separately funded independent blog just to do a JP watch. seriously.
do you serve alcohol?