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 influence any problems then and it hasnt solved any problems in 50 years.-- pot RaeseFor many years it has been a matter of conventional wisdom among economists that the token(prenominal) 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 distend analysis to justify. Were this not the case, there would be no logical earth why the borderline wage could not be set at $10, $100, or $1 million per hour. Historically, defenders of the minimum 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 scorn incomes of those without jobs, as a result of the minimum wage l levitan. Now, chair 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 humour and Alan Krueger of Princeton, and Lawrence Katz of Harvard. Their studies of increases in the minimum wage in California, Texas and New Jersey manifestly found no loss of jobs among fast food restaurants that were surveyed before and by and by the increase l card-92b, l krueger, and l katz. While it is not in so far clear why Card, Katz and Krueger got the results that they did, it is clear that their findings are directly contrary to about every empirical study ever done on the minimum wage. These studies were exhaustively surveyed by the minimal Wage Study Commission, which concluded that a 10% increase in the minimum wage reduced teenage employment by 1% to 3%. The following survey of the faculty member research on the minimum wage is designed to give non specialists 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, then depriving low wage workers of an important means of long-term advancement, in counterpunch for a small increase in current income. For many workers this is a very ... ...g (1996), Who Gets What from negligible Wage Hikes, Industrial and Labor Relations check out 49 (April) 547-52.------, and T. A. Finegan (1989), The Minimum Wage and the Poor The End of a Relationship, ledger 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. tater and F. Welch (1995), Employment and the 1990-1991 Minimum Wage Hike, American Economic Review text file and Proceedings 85 (May) 232-37. Gramlich, E. (1976), Imp act of Minimum Wages on former(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 registration 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.