Monday, February 18, 2013

A challenge to proponents of a minimum wage of $9 per hour – what theory or analysis justifies that specific wage?

A challenge to proponents of a minimum wage of $9 per hour – what theory or analysis justifies that specific wage? | AEIdeas
"Bottom Line: If there is no economic theory or logic or cost-benefit analysis that justifies $9.00 per hour as an optimal wage for unskilled, entry-level workers, which seems to be the case, then a $9.00 minimum wage is exposed as being totally arbitrary and random.
Unless and until Obama and other proponents of a $9 per hour minimum wage can provide some analysis to show that $9 is optimal and maximizes the net benefits to unskilled workers, then it’s a policy that really can’t be taken seriously.
Further, the minimum wage requires a costly regulatory mechanism that administers and enforces the government-mandated wage, which is a cost that needs to be considered."

No comments: