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Economists agree: Raising the minimum wage reduces poverty

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Re: Economists agree: Raising the minimum wage reduces poverty

#71

Post by crdoconnor »

jbellis wrote: post #22

It's pretty easy to find research coming to a different conclusion than the Card/Kreuger paper that most pro-minimum-wage-increase people cite: http://gregmankiw.blogspot.com/2006/06/sperling-on-minimum-w... http://cafehayek.com/2009/09/new-study-casts-doubt-on-card-k... http://rjwaldmann.blogspot.com/2009/12/in-which-i-disagree-w... But the best reasoning I've seen on the subject is Bryan Caplan's: "Suppose you have…

>It's pretty easy to find research coming to a different conclusion than the Card/Kreuger paper that most pro-minimum-wage-increase people cite

It's usually riddled with methodological flaws, however, or not in the slightest bit empirical (as your last link so perfectly demonstrates - the guy doesn't even WANT empirical data!).

Neumark/Wascher, while empirical, was a crock of shit that restricted and modified Card/Krueger's data set in an attempt to change the outcome.

Card/Krueger has also, incidentally, been repeated across multiple state borders and has held up.

Of course there is a very good reason why there is a consistent effort to push the idea that hiking the minimum wage causes unemployment despite it being clearly false...

It's SAVAGE towards profits:

http://164.36.50.178/lowpay/research/pdf/NMW_profits_and_pri...

This is why Mankiw and other intellectual frauds in the hock of corporate lobbyists will always push this lie.

Re: Economists agree: Raising the minimum wage reduces poverty

#72

Post by crdoconnor »

logicchains wrote: post #32

The minimum wage is ultimately always zero; employers can simply choose to not hire you if they think your productivity is not enough to justify paying you the minimum. As an Australian who spent a couple of years in Asia (where minimum wages are much lower than Australia's $16/hour), one of the most stinking things I noticed was how much easier it was to find work there. I have 'unskilled' Australian friends who hav…

>In Singapore for instance it seemed rare for somebody to take more than a week or two to find work.

It took me a LONG time, and the work I ultimately found was much lower paid than it would be in Australia, the US or Europe.

Singapore is a perfect example of what happens if you have no minimum wage. The majority of the country's wealth gets diverted towards profits. Wages all around are lower.

The only reason it doesn't cause massive social instability in SG is because the government keeps housing, health care and education affordable by rigid price fixing.

Re: Economists agree: Raising the minimum wage reduces poverty

#73

Post by crdoconnor »

jswinghammer wrote: post #11

The basic issue is that economics is not an empirical discipline but rather a deductive one. You cannot test anything in isolation because you cannot have a control. All economists can say is "If you do X when nothing else changes Y will result". It is basic economics that when the government mandates a price floor then anyone who cannot sell their goods for anything below that floor will not be able to sell their go…

Empirical studies that show no rise in unemployment do actually disprove that.

This attitude that empirical study doesn't matter, that only the accepted dogma of the economic establishment matters is primarily responsible for the disastrous state of the world economy.

People with your staunch beliefs would do better studying at a theological college where less harm will be done.

Re: Economists agree: Raising the minimum wage reduces poverty

#74

Post by cjo »

jswinghammer wrote: post #63
cjo wrote: post #62

Earlier quoted context omitted.

Well I certainly agree that money in general and our relationship to it could use a good rethinking - which is a surprisingly unpopular opinion considering America's financial sector pretty much imploded just a few years ago. But I don't follow how solving that problem addresses markets becoming concentrated and member firms using that advantage to push wages down towards subsistence levels. That I think requires som…

Marx was concerned about wages being pushed down but even in his own lifetime it never really happened that way. It's something that seems desirable for the businessman if possible but something that they have no control over. The reason being that other companies will compete for workers and have an easy competitive advantage over firms who are trying to drive workers to poverty. Markets work to coordinate prices fo…

Ah, c'mon, don't pin it on The Bearded Guy! That stuff predated him (see Ricardo's Law of Rent: https://en.wikipedia.org/wiki/Law_of_rent). The Bearded Guy was after all the last of the Classical Economists :)

He also didn't think wages would make it to subsistence: https://en.wikipedia.org/wiki/Iron_law_of_wages#Socialist_cr...

Re: Economists agree: Raising the minimum wage reduces poverty

#75

Post by crdoconnor »

bjornsing wrote: post #52
jbellis wrote: post #22

It's pretty easy to find research coming to a different conclusion than the Card/Kreuger paper that most pro-minimum-wage-increase people cite: http://gregmankiw.blogspot.com/2006/06/sperling-on-minimum-w... http://cafehayek.com/2009/09/new-study-casts-doubt-on-card-k... http://rjwaldmann.blogspot.com/2009/12/in-which-i-disagree-w... But the best reasoning I've seen on the subject is Bryan Caplan's: "Suppose you have…

On paper there's a solution to this problem: Negative income tax [1]. Would be interesting to see it implemented somewhere... 1. http://en.wikipedia.org/wiki/Negative_income_tax

It's not a problem. Negative income tax and EITC is another way of saying "I'm ok in theory with giving more money to the poor, but let's not divert the money from corporate profits to do that".

(that being the normal outcome of a hiked minimum wage)

It's a distraction in other words. A way to stop people demanding for a minimum wage hike.

Re: Economists agree: Raising the minimum wage reduces poverty

#76

Post by crdoconnor »

jswinghammer wrote: post #29
cjo wrote: post #23

Earlier quoted context omitted.

> It is basic economics that when the government mandates a price floor then anyone who cannot sell their goods for anything below that floor will not be able to sell their goods. Thus it will hurt those it's trying to help. Applying this to the low end of the labor market is pushed in a lot of Econ 101 classes but it requires so many assumptions to be true that the model only has a passing resemblance to reality. To…

Yes they can. This is because we can discuss what higher prices do-invariably they cause market actors to seek substitutes. If you push a $15 minimum wage it stands to reason that there would be demand for any machinery that would allow for cost savings. It would be good for the sectors of the economy that would supply these cost savings technologies. Ultimately marginal workers would get hurt even further once these…

>Yes they can. This is because we can discuss what higher prices do-invariably they cause market actors to seek substitutes. If you push a $15 minimum wage it stands to reason that there would be demand for any machinery that would allow for cost savings

Wake me when there's an affordable machine that can clean my office as well as a human. And no, I don't mean a Roomba - they're toys.

This capitalist techno-utopianism is totally divorced from the real world. Even automated checkouts (which have been around for over a decade) still haven't eliminated cashiers and for good reason - because people suck at using them.

Re: Economists agree: Raising the minimum wage reduces poverty

#77

Post by crdoconnor »

erichocean wrote: post #31

"Reducing poverty" is a good reason, which is why minimum-wage advocates talk about it. But the real reason minimum-wage advocates want to increase the minimum wage is to increase the pay of union members, who's pay is indexed to the minimum wage. That's the voting block that matters to politicians, not the near poor, who barely vote and certainly don't have the time (or skills) for political activity (unlike the uni…

Unions haven't mattered to politicians in decades.

However, corporate lobbyists do - they largely control Congress and the executive branch.

Wanna know why they're against a higher minimum wage? Because it's inversely proportional to their profits.

Re: Economists agree: Raising the minimum wage reduces poverty

#78

Post by crdoconnor »

xixi77 wrote: post #57

And how exactly does "there is a paper that claims X" translate into "Economists agree that X is true"? Well, it doesn't. In fact, I would generally be skeptical about any claim that starts with "Economists agree...", such is the nature of the profession. Also, if we actually admit the effect on poverty to be true, the most obvious way to reconcile this is that newly-unemployed (and hence poor) workers move to places…

So you're saying Australians who have a MUCH higher minimum wage and MUCH lower unemployment should move to America?

Heh.

Re: Economists agree: Raising the minimum wage reduces poverty

#79

Post by crdoconnor »

jedmeyers wrote: post #37
krakensden wrote: post #18

Earlier quoted context omitted.

Just because things don't work asymptotically doesn't mean they don't work.

But why would a $15/hour minimum wage work and $100/hour won't? Where between 15 and 100 do you draw the line and why?

Australia's on roughly $15/hour. They have LOWER unemployment.

You draw the line when you start getting inflation at about 10-12%. That's when inflation starts to have an effect on economic growth.

It could be raised gradually until that point.

Re: Economists agree: Raising the minimum wage reduces poverty

#80

Post by spikels »

No they don't! [1-6]

The author of this piece, Mike Koczal, is an ideological blogger. You can catch him on Salon, MSNBC, TNR, etc. The main economist mentioned, Arin Dube, is not mainstream. He is actually sympathetic to Soviet central planning[7]. And the UMass Amherst Economics department has a well know for its "offbeat" views (e.g. numerous courses that take Marx seriously), not mainstream, not concensus.

The truth is this is a controversial, basicly idealogical, issue and if any consensus exists it is that the results will be mixed: some better and some worse off (i.e. unemployed).

[1] http://www.intellectualtakeout.org/library/chart-graph/econo...

[2] http://economix.blogs.nytimes.com/2013/03/04/what-economists...

[3] http://en.wikipedia.org/wiki/Minimum_wage#Surveys_of_economi...

[4] http://www.princeton.edu/~tleonard/papers/minimum_wage.pdf

[5] http://www.epionline.org/studies/epi_minimumwage_07-2007.pdf

[6] http://www.intellectualtakeout.org/library/chart-graph/econo...

[7] http://economistsview.typepad.com/economistsview/2012/10/a-n...

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