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There are 4 comments on POV: Raise the Minimum Wage, but Don’t Expect Much

  1. What about how increasing government expenditures reduces the wage rate? Also as economists, we understand the substitution effect where as people have more incentive (higher wage) to do something, and less incentive to do something else (reduced profits from opening a small business) then there will be an effect where people decide to work at the minimum wage rate rather than open a business. In my mind, the American dream has been to own and operate your small business which this raise will no doubt stymie in more than one way. Along with the affordable care act, which like it or not has increased costs on small businesses, this effort could deliver a knock out blow to many owners who simply don’t have the margins to afford to keep their shops open. Also Milton Friedman has many good YouTube videos in which he discusses minimum wage and how it isn’t the road out of poverty. I suggest you search them as they are incredibly enlightening.

    1. Capital has had plenty of incentive to open up business. The rate of return of capital now compared to labor is a big problem. If you have more than 50 employees then you aren’t a small business anyways.

    2. Milton Friedman’s theories from the 60s are fast becoming as outdated as Adam Smith’s(we no longer live in a world full of small agrarian towns.)

  2. Citing a survey of studies from 2006-7 may not be very useful considering the lag between income and expenses has continued to increase.

    More recent anecdotal information, such as San Jose,Ca. after measure D seem not to fit the older data.

    A modest improvement for a few people on the edge of the poverty line is a MAJOR improvement in the lives of those few people. Just as a modest decline in employment is a MAJOR loss for the few people affected.

    Everyone who is poor or unemployed is 100% affected by poverty and unemployment. It might not make statistical sense, but a statistically modest improvement is a personally substantial improvement for those whose lives are directly affected.

    I support a compassionate response that benefits people in need.

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