Page 7 of 41 FirstFirst ... 5678917 ... LastLast
Results 61 to 70 of 402
Thanks Tree78Thanks

Thread: Seattle's new minimum wage hasn't raised retail prices

  1. #61
    Scucca Æthelfrith's Avatar
    Joined
    Jun 2010
    Posts
    6,944
    Thanks
    1458

    Quote Originally Posted by Jets View Post
    The author doesn't need to state the obvious. If money wasn't lost there wouldn't be a discussion on why the minimum wage increase in this scenario did not work as planned.
    But they do state the obvious: there are heterogeneous effects, ensuring that well-being effects are not known.

    I've already referred to three key aspects: First, monopsony does predict some firm exit effects are possible (but the overall well-being effect is ambiguous). Second, there will be voluntary reductions in hours because of backward bending labour supply effects. Third, there will also be reduction in hours because low wages and working poverty are not perfectly matched (e.g. second earner effects). Essentially anyone saying "workers are $125 worse off" has zero understanding of basic economics.

  2. #62
    the "good" prag pragmatic's Avatar
    Joined
    Feb 2010
    Posts
    28,579
    Thanks
    17286

    From
    between Moon and NYC
    Quote Originally Posted by Æthelfrith View Post
    You've referred to involuntary hours reductions, but that is just an assumption. Voluntary changes in hours are expected through minimum wages
    Yeah.

    Am making that crazy assumption that the bulk of the people did not intentionally cut their own monthly income by $125.

  3. #63
    quichierbichen
    Joined
    Feb 2010
    Posts
    61,290
    Thanks
    33142

    From
    in my head
    Quote Originally Posted by Æthelfrith View Post
    An inane response! The average isn't useful for well-being analysis, as illustrated by backward bending labour supply curves (which inform us of hours reductions and well-being increases).
    Perhaps you could define "backward bending labour supply curves." That's a term I'm not familiar with, though I appreciate the metaphor, if it refers to the workers' posture....

  4. #64
    quichierbichen
    Joined
    Feb 2010
    Posts
    61,290
    Thanks
    33142

    From
    in my head
    Quote Originally Posted by Macduff View Post
    Common sense is that when you make something more expensive, there will be less demand for it. That's just basic economics.
    Of course, that's not true of some products. Education is an example. Luxury products are another.

  5. #65
    Scucca Æthelfrith's Avatar
    Joined
    Jun 2010
    Posts
    6,944
    Thanks
    1458

    Quote Originally Posted by pragmatic View Post
    Yeah.

    Am making that crazy assumption that bulk of the people did not intentionally cut their own monthly income by $125.
    Your assumption ensures your irrelevance. Hours worked can be used to indicate changes in overall employment levels. That's it! We have no appreciation of well-being effects. We can't say people are worse off. We can't say people are forced from their optimal labour.

  6. #66
    Scucca Æthelfrith's Avatar
    Joined
    Jun 2010
    Posts
    6,944
    Thanks
    1458

    Quote Originally Posted by Rasselas View Post
    Perhaps you could define "backward bending labour supply curves." That's a term I'm not familiar with, though I appreciate the metaphor, if it refers to the workers' posture....
    It all comes down to how economists separate wage effects into income effects and substitution effects. We typically assume that substitution effects dominate. Thus, as wages increase folk will naturally shift hours from leisure to labour. However, with a backward bending curve all bets are off. For various reasons an increase in wage can actually reduce hours worked.

  7. #67
    Senior Member
    Joined
    Jan 2014
    Posts
    10,165
    Thanks
    2648

    From
    California
    Quote Originally Posted by Æthelfrith View Post
    But they do state the obvious: there are heterogeneous effects, ensuring that well-being effects are not known.

    I've already referred to three key aspects: First, monopsony does predict some firm exit effects are possible (but the overall well-being effect is ambiguous). Second, there will be voluntary reductions in hours because of backward bending labour supply effects. Third, there will also be reduction in hours because low wages and working poverty are not perfectly matched (e.g. second earner effects). Essentially anyone saying "workers are $125 worse off" has zero understanding of basic economics.
    Mr. Ethelfrith,

    LOL, if you can dazzle them with brilliance, baffle them with bullshit, wot? Or in your case, throw out a bunch of economic terms that have nothing to do with the discussion, then hope nobody knows what they mean.

    First, there is not a monopsony, but rather a market with multiple players, ergo, the businesses involved are not forced to cater to just one client or group. Second, in the upper echelon of pay scales, workers may choose to reduce hours or will be happy to work reduced hours, but at the very bottom end, workers want as many hours and as much pay as the businesses are willing to give them.

    Your third point is spot on and is the issue. Businesses need to cut costs, so they will cut the hours of the lowest wage earners, getting them to do as much in less time.

    And by your saying "a worker who needs all the money he can get, earning $125 less is not worse off" shows that it is you that has zero understanding of basic economics.

  8. #68
    quichierbichen
    Joined
    Feb 2010
    Posts
    61,290
    Thanks
    33142

    From
    in my head
    Quote Originally Posted by Æthelfrith View Post
    It all comes down to how economists separate wage effects into income effects and substitution effects. We typically assume that substitution effects dominate. Thus, as wages increase folk will naturally shift hours from leisure to labour. However, with a backward bending curve all bets are off. For various reasons an increase in wage can actually reduce hours worked.
    Okay. That was clear as mud in terms of explaining how your point counters the points of others. Seems like you are saying the same thing.

  9. #69
    Scucca Æthelfrith's Avatar
    Joined
    Jun 2010
    Posts
    6,944
    Thanks
    1458

    Quote Originally Posted by Rasselas View Post
    Okay. That was clear as mud in terms of explaining how your point counters the points of others. Seems like you are saying the same thing.
    Nope. They are stating involuntary hours effects necessarily make people worse off. I've done what they can't: refer to labour supply analysis to indicate how voluntary hours effects are expected.

  10. #70
    Senior Member
    Joined
    Jan 2014
    Posts
    10,165
    Thanks
    2648

    From
    California
    Quote Originally Posted by Rasselas View Post
    Of course, that's not true of some products. Education is an example. Luxury products are another.
    Mr. Rasselas,

    It is economic theory where as wages and compensation increases, workers will opt for more time off in compensation....

    In short, it has nothing to do with this discussion.

Page 7 of 41 FirstFirst ... 5678917 ... LastLast

Similar Threads

  1. Replies: 45
    Last Post: 14th November 2015, 01:22 PM
  2. Seattle’s minimum wage increase ‘shuttering’ businesses
    By meridian5455 in forum Current Events
    Replies: 232
    Last Post: 20th March 2015, 09:28 AM
  3. Seattle eateries closing as $15 minimum wage approaches
    By timslash in forum Current Events
    Replies: 45
    Last Post: 17th March 2015, 03:03 PM
  4. Job Growth Grows in States that raised minimum wage.
    By Michele in forum Current Events
    Replies: 9
    Last Post: 24th October 2014, 06:38 AM
  5. Replies: 31
    Last Post: 15th July 2014, 12:02 AM

Search tags for this page

Click on a term to search for related topics.

Tags for this Thread


Facebook Twitter RSS Feed