Comments on: The minimum wage. http://www.eridu.org.uk/blog/2008/04/18/the-minimum-wage-2/ Liberalism and general burblings Sun, 20 Jul 2008 10:50:48 +0000 http://wordpress.org/?v=2.6 By: David Morton http://www.eridu.org.uk/blog/2008/04/18/the-minimum-wage-2/#comment-29074 David Morton Sat, 19 Apr 2008 00:15:37 +0000 http://www.eridu.org.uk/blog/2008/04/18/the-minimum-wage-2/#comment-29074 I'm unaware of any evidence to actually support this. The introduction in 1999 didn't have any effect on employment rates and since its risen modestly above the RPI inflation rate without any obvious ill effect. You seem to be making the fairly crude argument that price rises always cause falls in demand. Some products are quite inelastic and minimum wage jobs particularly in the service industry where they can't be shipped abroad are one of them. I’m unaware of any evidence to actually support this. The introduction in 1999 didn’t have any effect on employment rates and since its risen modestly above the RPI inflation rate without any obvious ill effect. You seem to be making the fairly crude argument that price rises always cause falls in demand. Some products are quite inelastic and minimum wage jobs particularly in the service industry where they can’t be shipped abroad are one of them.

]]> By: Tinter http://www.eridu.org.uk/blog/2008/04/18/the-minimum-wage-2/#comment-29071 Tinter Fri, 18 Apr 2008 22:43:08 +0000 http://www.eridu.org.uk/blog/2008/04/18/the-minimum-wage-2/#comment-29071 I don't think your reasoning follows. We don't have a particular problem with unemployment, and our worst problems occured when we didn't have a minimum wage. Possibly there is a connection, but it doesn't make sense in the context of your second point. Employers fail to employ due to the costs of the minimum wage, but without it they would create even more jobs with more expensive conditions? If the minimum wage produces worse conditions it makes it more favourable to invest in labour, and creates jobs! Of course, it doesn't, so your second point doesn't make sense. Its an empirical fact that take home pay for the lowest paid has increased in every country that has introduced a minimum wage. I mean, the facts do not back your reasoning, so one of them has to be wrong, and I'm pretty sure where ideology comes when it faces data. I don’t think your reasoning follows. We don’t have a particular problem with unemployment, and our worst problems occured when we didn’t have a minimum wage. Possibly there is a connection, but it doesn’t make sense in the context of your second point.

Employers fail to employ due to the costs of the minimum wage, but without it they would create even more jobs with more expensive conditions? If the minimum wage produces worse conditions it makes it more favourable to invest in labour, and creates jobs! Of course, it doesn’t, so your second point doesn’t make sense.

Its an empirical fact that take home pay for the lowest paid has increased in every country that has introduced a minimum wage. I mean, the facts do not back your reasoning, so one of them has to be wrong, and I’m pretty sure where ideology comes when it faces data.

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