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Old 07-26-2019, 12:21 PM
Wrenching Spanners is offline
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Join Date: Jun 2011
Location: London
Posts: 639
Quote:
Originally Posted by puddleglum View Post
The problem with this is that if the market fairly values unskilled workers at a price below the minimum wage then either the employers altruistically pay them more than they are worth or do not hire them at all. The latter is much more likely. Thus those with the lowest skills are unemployable and have to be taken care of by everyone else instead of supporting themselves at a low paying job.
1) Strictly speaking, obeying the law isnít altruistic. I donít litter because I dislike litter. Thatís a personal preference. Some people may not care about litter, but avoid littering because theyíre afraid of being caught and fined. Thatís consequence avoidance. If you pick up other peopleís litter because you think it improves the community, thatís altruism. Similarly if an employer provides a benefit even though they arenít required to and thereís no market-risk and not doing so, thatís altruism. But obeying a minimum-wage law isn't.

2) Iím not going to hijack a thread about personal responsibility into a debate about the minimum wage. My one comment is to note that the risk of a minimum wage increase is that it will turn a profitable activity into an unprofitable activity, and there isnít sufficient demand for the activity at the increased price required for the activity to be profitable for it to continue. However, across the entire consumer market, demand is fairly inelastic. People will generally switch to a lower priced alternative, but if all alternatives increase in price, people will usually pay the increased price rather than end their consumption.