Pelosi exempts American Samoa from minimum wage hike.

[Hogeye]

Doug, I guess you missed the numerous references to empirical studies on which that prediction was based. E.g.

Most of the empirical research on minimum wages has focused on the relationship between minimum wage increases and employment rates...

...

In this study, we use variation in minimum wages across states and over time to identify their effect on the size of the state welfare caseload. Our empirical results indicate that, once state trends and a variety of other factors are accounted for, the elasticity of the welfare caseload with respect to the minimum wage is between 0.1 and 0.2. In other words, a 35 percent increase in the minimum wage like that recently implemented in California could lead to a 3 to 7 percent increase in the size of the welfare caseload, holding all else equal. These results are remarkably stable to the inclusion of other variables that influence the evolution of caseloads over time, such as state-specific welfare reforms and changing political preferences.

...

The impact of raising the minimum wage has been studied since its inception. All credible research has come to the same conclusion: raising the minimum wage hurts the poor. It takes away jobs, keeps people on welfare, and encourages high-school students to drop out.

And so on. Instead you ignore all the empirical stuff and pick a recent example that hasn't been studied yet! How dare they make a prediction based on facts!

No studies done? Read my source, which I cited at length.

Yes, I've read it and re-read it. Scott Bailey doesn't cite one single study of actual effects of the Washington minimum productivity laws. (He does casually mention a predictive model, but of course that doesn't count.) I even googled Bailey and found out what he does - he writes reports about standard economic data such as unemployment rates. He does not even attempt to relate them to minimum productivity laws in his paper. So all he's saying in your quote is that there's no superficially obvious rise in unemployment. He doesn't attempt to look at such law's effects in the context of larger economic trends, as do the people who study the issue. You are mistaken that he has done "a statewide study." There is a difference between a study and the "suggestion" of a "what if" economic model. (Furthermore, it is unclear whether Bailey had anything to do with the U of Wash. "economic model." For all we know, it was a freshman econ project done in a dorm room.)

29 states have raised their minimum wages above the federal level. Show that this has had an adverse effect on any of them.

The economists cited above have already done that, except for recent ones where the data isn't in yet. Read some of the links I provided.

It comes down to the value judgement of having people work and still wallow in poverty OR up grade their jobs skills (so they aren't working some stupid job that isn't needed or can be done by a machine).

I agree. That's why minimum productivity laws are so bad. They prevent people from acquiring job skills by starting out at a low wage and learning. Such laws kill the informal apprenticeship necessary to get paid more. Question: What percent of minimum wage earners have held the same job for more than a year? Minimum productivity laws, in effect, outlaw entry level jobs and thus keep marginally-skilled people mired in poverty.

Statists seem to have a belief in magic - if you simply pass a law and wish real hard, people will become wealthier. Sheesh!

Darrel, at least your long quote about Oregon is honest: "A systematic study of the employment impacts of Oregon's minimum wage increase has not been conducted." But then they go on about the raw unemployment rate (like Bailey) without considering trends, new factories (did Toyota or Boeing open up a plant?) and all the other factors that need to be controlled for in a real study. Let's wait for real economists to look at it when the data is in.

See here for the footnotes for #2 and #3.

This article debunks the Card/Krueger studies. In short, "These studies by Card and Krueger show only that a small increase in minimum wage rates might not cause much of an increase in unemployment. Such studies ignore the fact that the current level of minimum wages are already causing significant unemployment for some workers." They also note that you have to look at minimum wage earners; if you look at unemployment as a whole, then info about min wage earners is swamped by the vast majority getting more than minimum wage (which minimum wage laws don't affect.)

Darrel, your "Minimum Wage and Welfare Reform" citation says nothing about whether minimum productivity laws cause unemployment. It does imply that if you cut women off welfare, they can command higher wages than the random person leaving welfare. IOW they admit that any info about minimum wage is swamped by the mandated welfare reform which cut a bunch of women off.

What I said was that minimum-wage employers can't lay off people - they don't hire enough people to be able to lay off anybody (to change total numbers of bodies working).

Sure they can. They can replace people by capital goods - by machines. Make smarter, user friendly elevators and gas pumps, and eliminate the job holding skills and informal apprenticeship for auto mechanics. Darrel doesn't care, he says, that these people become unemployable. And he doesn't care or perhaps doesn't know that the vast majority of minimum wage earners earn significantly more than that if they hold on to their job for a year. Minimum wage earners are not a class - they are a transition stage people pass through as their dependability and productivity increases.

As to getting people off welfare - for single mothers it's a no-brainer. The $110 a week for preschool child care is impossible on $5.15/hour, even with a 40-hour work week. That puts a single mom on welfare. On $7.15/hour it's not easy, but it's possible. That gets a single mom off welfare.

No - that only gets mom off welfare if she is able to produce $7.15 + employee overhead worth of goods for someone willing to hire her. If she can't produce $7.15+, your minimum productivity decree keeps her unemployed with no chance to even upgrade her experience and skills on the job.

I'll wind up with a quote from my hero.

In truth, there is only one way to regard a minimum wage law: it is compulsory unemployment , period. The law says: it is illegal, and therefore criminal, for anyone to hire anyone else below the level of X dollars an hour. This means, plainly and simply, that a large number of free and voluntary wage contracts are now outlawed and hence that there will be a large amount of unemployment. Remember that the minimum wage law provides no jobs; it only outlaws them; and outlawed jobs are the inevitable result. - Outlawing Jobs: The Minimum Wage, Once More

[Dardedar]

Darrel, your "Minimum Wage and Welfare Reform" citation says nothing about whether minimum productivity laws cause unemployment.

DAR
Unemployment in the US is insignificant. This fact makes me unconcerned with the free market worshippers who pretend, on this issue, to be suddenly concerned about the poor. There may be some countries that tend too high on their minimum wage and thus suffer some moderately higher unemployment. The US is not one of those countries.

I'll wind up with a quote from my hero.

In truth, there is only one way to regard a minimum wage law: it is compulsory unemployment , period. The law says: it is illegal, and therefore criminal, for anyone to hire anyone else below the level of X dollars an hour. This means, plainly and simply, that a large number of free and voluntary wage contracts are now outlawed and hence that there will be a large amount of unemployment.

DAR
No surprise that Rothbard would overstate his case and not get his facts straight. There are many exceptions to minimum wage laws. You can read about them here.

D.

[Doug]

Doug, I guess you missed the numerous references to empirical studies on which that prediction was based. E.g.

Most of the empirical research on minimum wages has focused on the relationship between minimum wage increases and employment rates...

...

In this study, we use variation in minimum wages across states and over time to identify their effect on the size of the state welfare caseload. Our empirical results indicate that, once state trends and a variety of other factors are accounted for, the elasticity of the welfare caseload with respect to the minimum wage is between 0.1 and 0.2. In other words, a 35 percent increase in the minimum wage like that recently implemented in California could lead to a 3 to 7 percent increase in the size of the welfare caseload, holding all else equal. These results are remarkably stable to the inclusion of other variables that influence the evolution of caseloads over time, such as state-specific welfare reforms and changing political preferences.

DOUG
I still don't see anything but projection. The paragraph is consistent with computer models over various states at different models of minimum wage as a variable. Calling it an "empirical study" doesn't mean it is one. It looks like right-wing doubletalk.

Again, show how an increase in minimum wage HAS impacted the economy of a state negatively. Minimum wages have increased in many states on many occasions. If this adversely impacts a state's economy, you should be able to point out instances in which this is so.

So do it.

I even googled Bailey and found out what he does - he writes reports about standard economic data such as unemployment rates. He does not even attempt to relate them to minimum productivity laws in his paper.

He is an economist with the Washington State Employment Security Department. He doesn't just "write reports about standard economic data." He gathers and analyzes data.

...So all he's saying in your quote is that there's no superficially obvious rise in unemployment.

No, he is saying that he hasn't been able to detect any rise in unemployment or any other negative effects.

Look, YOU are claiming that a rise in minimum wage results in higher unemployment. Washington state has the highest minimum wage in the country, and it has been very high for several years (see previous post). If your claim is correct, you should be able to cite negative statistics about Washington state.

Do so or admit you are incorrect.

[Hogeye]

I still don't see anything but projection.

The "the elasticity of the welfare caseload with respect to the minimum wage is between 0.1 and 0.2" is based on empirical evidence. The example, "In other words, a 35 percent increase in the minimum wage like that recently implemented in California could lead to a 3 to 7 percent increase in the size of the welfare caseload, holding all else equal," is a projection. BTW, the whole paper can be downloaded (in PDF) from the abstract page.

Again, show how an increase in minimum wage HAS impacted the economy of a state negatively.

"Impacted the state negatively" is too vague. Relying on the existing research, what is clearly shown (both praxeologically and empirically) is that an increase in minimum wage causes an increase in unemployment among marginally skilled people. That one's solid.

Another claim that's probably generally true, but somewhat iffy, is: A raise in minimum wage increases welfare rolls/dependency. Part of the iffiness comes from the fact that some/many that take advantage of welfare are not low-skilled, so minimum productivity laws don't affect them. And, as Barbara recently pointed out, many may opt to stay on welfare until a much higher than minimum wage job is offered, since they make more by staying on welfare. If a raise in minimum wage minus child care nets less than AFDC welfare, then the raise doesn't affect employment status. The various, often perverse incentives of welfare make it harder to show connections with minimum productivity laws.

He [Bailey] is saying that he hasn't been able to detect any rise in unemployment or any other negative effects.

Right. That's what I said. And he has done no studies attempting to show any correllation. He doesn't claim to have done any studies. He has simply looked at raw unemployment data and drawn superficial conclusions. Read his reports - they're online.

YOU are claiming that a rise in minimum wage results in higher unemployment. Washington state has the highest minimum wage in the country, and it has been very high for several years (see previous post). If your claim is correct, you should be able to cite negative statistics about Washington state.

Yes, me and most reputable economists who have done studies claim minimum wage laws result in higher unemployment than would otherwise be the case. And theory backs that empirical result.

Your request about Washington state is unreasonable. It is precisely because Washington has had minimum wage for so long that makes it hard to deduce what otherwise would be the case. The easiest to show, of course, is cases of large sudden changes in the mandated wage. Gradual changes over a long period are the most difficult. (Generally; if you have a comparable "control" group, it could be done. But Washington, with Boeing, Microsoft, and urban Seattle in the west, and a rural east of mountains Spokan area, cannot well be compared to Idaho or Oregon. Idaho is mostly rural; Oregon also has high minimum productivity levels, so is no contrast in that regard.)

I'm satisfied with the ample evidence generated from other states, from places with large sudden changes in mandated wages. You have given no reason why Washington would be an exception, other than claims from some govt spokesman-bureaucrat from the Washington Employment Security Division who has never done a study.

[Doug]

I still don't see anything but projection.

The "the elasticity of the welfare caseload with respect to the minimum wage is between 0.1 and 0.2" is based on empirical evidence.

DOUG
OK, so what is the significance of this apparently minor fluctuation? Do you have some point to go with this, or are you just fascinated by numbers? And what hard data supports this or is supported by it?

Again, show how an increase in minimum wage HAS impacted the economy of a state negatively.

"Impacted the state negatively" is too vague. Relying on the existing research, what is clearly shown (both praxeologically and empirically) is that an increase in minimum wage causes an increase in unemployment among marginally skilled people. That one's solid.

OK, then SHOW with evidence that an increase in minimum wage causes an increase in unemployment among marginally skilled people.

As I have already pointed out, 29 states have enacted increases in their minimum wages above levels mandated by the federal government. So you should have 29 good cases for us to see.

Let's see them. Quit stalling.

He [Bailey] is saying that he hasn't been able to detect any rise in unemployment or any other negative effects.

Right. That's what I said.

NO, that is not what you said. You decided to spin it and assert that "all he's saying in your quote is that there's no superficially obvious rise in unemployment."

You tried to spin Bailey's research and give the impression that:

a. He had done only superficial research, and
b. He was just a "writer" as opposed to a trained economist working for the state of Washington doing job security analyses.

That's not very nice, distorting Bailey's credentials and his work.

And he has done no studies attempting to show any correllation. He doesn't claim to have done any studies. He has simply looked at raw unemployment data and drawn superficial conclusions. Read his reports - they're online.

YOU and the conservatives who want to pay low wages are the ones who assert a correlation between an increase in minimum wage levels and an increase in unemployment and other undesirable economic effects on a state. So the burden is on YOU to show a correlation, not on Bailey to show some sort of correlation. He is not asserting a correlation in reporting that there isn't a detectable correlation!

YOU are claiming that a rise in minimum wage results in higher unemployment. Washington state has the highest minimum wage in the country, and it has been very high for several years (see previous post). If your claim is correct, you should be able to cite negative statistics about Washington state.

Yes, me and most reputable economists who have done studies claim minimum wage laws result in higher unemployment than would otherwise be the case. And theory backs that empirical result.

Uh, Hoggie. First show the empirical result. Then you can talk theory.

Show that Washington state, with years of high minimum wages, suffers from ill effects in the way you assert that it should be suffering.

Your request about Washington state is unreasonable. It is precisely because Washington has had minimum wage for so long that makes it hard to deduce what otherwise would be the case. The easiest to show, of course, is cases of large sudden changes in the mandated wage. Gradual changes over a long period are the most difficult.

Oh, you are changing your claim again. So you are not claiming that high minimum wages in a state would negatively impact that state economically. All right. For a while I thought you were asserting that. Silly me.

OK, are you aware that increases in the minimum wage as per the proposed bills in Congress would be phased in over a period of years? So how "sudden" would the increase have to be before the bad stuff you predict would take place? Give me a time frame and a ratio of increase.

As if you could...

I'm satisfied with the ample evidence generated from other states, from places with large sudden changes in mandated wages.

Too bad you won't share your allegedly satisfactory evidence. Of the 29 states that have higher than federally mandated minimum wages, you can't tell us of ONE that has clearly been negatively impacted economically? I don't know why you would be satisfied with that.

You have given no reason why Washington would be an exception...

a. Exception? You have proven no rule to which it would be an exception.
b. No negative effects of having the HIGHEST minimum wage in the nation--for years-- are discernible. But you don't see that as evidence that its higher minimum wage has had no negative impact on the state? Gee, I'm sorry that I am totally unable to give you a reason to believe that Washington has not been negatively impacted by its high minimum wage laws. I was foolish enough to think that the lack of negative effects would be enough...

other than claims from some govt spokesman-bureaucrat from the Washington Employment Security Division who has never done a study.

Oh, so now the economist, Bailey, is just "some govt spokesman-bureaucrat"? OK. Too bad we can't find an economist there at the Washington Employment Security Division.

A list of his reports and articles can be found here.


Scott Bailey, Regional Labor Economist.
He holds an M.S. in economics from Portland State,
and a B.A. in Liberal Studies from Oregon State University.
He has been the Regional Economist for Southwest Washington
with the Washington Employment Security
Department since 1989.

[Hogeye]

Using your link, I looked at a dozen or so of Scott Bailey's reports. He is a reporter, and definitely not a researcher. He spits out raw data, mainly unemployment rates for various regions of Washington. He gives zero research, and very little analysis or theory. To his credit, he does a good job of making boring economic data readable. I think spokesman/bureaucrat is a reasonable description of what he does. Or economic statistics reporter.

Hogeye> The "the elasticity of the welfare caseload with respect to the minimum wage is between 0.1 and 0.2" is based on empirical evidence.

Doug> OK, so what is the significance of this apparently minor fluctuation?

Elasticity of between 0.1 and 0.2 is not minor. Which is why they gave an example for non-economists: "A 35 percent increase in the minimum wage like that recently implemented in California could lead to a 3 to 7 percent increase in the size of the welfare caseload."

SHOW with evidence that an increase in minimum wage causes an increase in unemployment among marginally skilled people.

Okay. Here's what the Bureau of Labor Statistics says:



Aha! Just what we're looking for - a survey of the vast evidence that minimum productivity laws reduce employment: 50 Years of Research on the Minimum Wage

These studies were exhaustively surveyed by the Minimum Wage Study Commission, which concluded that a 10% increase in the minimum wage reduced teenage employment by 1% to 3%.

      The following survey of the academic research on the minimum wage is designed to give nonspecialists a sense of just how isolated the Card, Krueger and Katz studies are. It will also indicate that the minimum wage has wide-ranging negative effects that go beyond unemployment. For example, higher minimum wages encourage employers to cut back on training, thus depriving low wage workers of an important means of long-term advancement, in return for a small increase in current income. For many workers this is a very bad trade-off, but one for which the law provides no alternative.

Just what you asked for.

First show the empirical result. Then you can talk theory.

I'd say you have it backwards here. Logic trumps empiricism, and so does praxeology. If someone came up to you and said, "I just observed something that is A and not A at the same time," you wouldn't chuck out logic. You'd probably think the person was crazy, or look for some basic error in their assumptions (e.g. an fallacy of equivocation, one of their A's is not really identical to the other.) If someone told you that they saw water running uphill, you wouldn't say, "Oh well, the law of gravity doesn't hold." Again, you'd look for errors in assumptions related to the law of gravity. Was it an optical illusion? Was energy added (a hand pump?) Did it occur in a space capsule? Similarly, if someone says a rise in price, of apples, gold, iPods, or labor, didn't result in lowering sales, you don't chuck out the praxeological law that people prefer more to less. You look for assumptions that don't hold. Was it really ceterus paribus, or unconsidered factors effect it? Thus, when employment isn't reduced after a raise in price, we need to ask what outside/unconsidered factors caused it.

Hogeye> Your request about Washington state is unreasonable. It is precisely because Washington has had minimum wage for so long that makes it hard to deduce what otherwise would be the case. The easiest to show, of course, is cases of large sudden changes in the mandated wage. Gradual changes over a long period are the most difficult.

Doug> Oh, you are changing your claim again. So you are not claiming that high minimum wages in a state would negatively impact that state economically.

No change. I continue to claim that a higher minimum wage mandate causes unemployment among marginally productive people. Apparently you don't understand the difficulty, so I'd better elaborate. In social sciences (and even some physical sciences) controlled experiments can't be done. One can't have a control group of Washingtons and compare them with actual Washingtons. (Just as you can't have a control group of meteors, or a control group of global climates to compare with the actually occurring one.) In short, there is a methodological difficulty in comparing what actually happened to what would have happened if X had been different. We're dealing with what you might call "subjunctive history" here.

You write as if you can simply look at raw unemployment data and draw a clear conclusion about what would have happened if there wasn't a governmentally fixed price floor for wages. But that ignores all the many other factors affecting unemployment. Did Toyota just build a factory? Did Boeing get a lucrative new defense contract? Did a software company grow from a few college dropouts to a mega-corporation? Did the strawberry crop fail? All these must be factored in to gauge what would have happened if. (That's why Scott Bailey's raw data tells us virtually nothing.)

The other point I made was that the effects of major change is easier to measure than the effect of marginal change. This of course doesn't mean that marginal change doesn't have effects; it just means the effects are harder to measure, largely having to do with accounting for all the other factors mentioned above that must be accounted for. If Washington had done all its min wage raise at one time (and there was no simultaneous Boeing contract or whatever), then the effect of that X% increase would be easy to measure. But Washington did its X% increase slowly, with many intervening economic events contributing "static."

Anyway, this is kind of moot after giving that long list of academic studies above. But note that the X% increase still has bad effects on unemployment, whether it's implemented quickly or slowly. It only the measurement which is made more difficult.

[Barbara Fitzpatrick]

Hogeye seems to be saying, in response to my comment about not mixing the apples of entire job categories disappearing due to technology and the oranges of supposed job loss due to minimum wage increase, that there would be no "labor-saving" technological advances without minimum wage. Funny that the elevator, operated by one person (that "elevator boy" later himself replaced by automatic elevators) replacing several men (or animals) moving platforms through vertical space was invented prior to minimum wage laws. Funny that the entire job category of buggy whip holder disappeared with the advent of automobiles prior to minimum wage laws. How, oh how, did human beings ever move from basic animal lifestyles into human technology without minimum wage laws forcing them to.

[Dardedar]

Aha! Just what we're looking for -

DAR
Hogeye is really good at finding what he is looking for. He finds it almost without exception. Perhaps without exception. And if he doesn't find what he is looking for, just change the meaning of the words.

a survey of the vast evidence that minimum productivity laws reduce employment:

DAR
There has never been a "minimum productivity law" passed. If you want to converse with rational adults then use standard language rather than childishly loaded phrases you make up.

D.

[Doug]

Using your link, I looked at a dozen or so of Scott Bailey's reports. He is a reporter, and definitely not a researcher.

Oh, so now the professional, formally trained, college-degreed economist is a "reporter."

The "the elasticity of the welfare caseload with respect to the minimum wage is between 0.1 and 0.2" is based on empirical evidence.

OK, so what is the significance of this apparently minor fluctuation?

Elasticity of between 0.1 and 0.2 is not minor. Which is why they gave an example for non-economists: "A 35 percent increase in the minimum wage like that recently implemented in California could lead to a 3 to 7 percent increase in the size of the welfare caseload."

You are still quoting where they have not shown that an increase in the minimum wage has increased the welfare caseload. You are quoting where they state that it could do so. And you pretended that this speculation is hard data. That's not right.

SHOW with evidence that an increase in minimum wage causes an increase in unemployment among marginally skilled people.

Okay. Here's what the Bureau of Labor Statistics says:

OK, now you are changing your thesis yet again. You are now asserting that an increase in the minimum wage increases teenage unemployment. That was not your claim before. Can you show that it increases unemployment as a whole? Can you show that perhaps people didn't hire adults instead of teens for the same jobs?

AND your source is some Republican "Talking Points." That's what it says on your source page.

Cite studies. List facts, not vague generalizations. I've already shown that Washington state, with the HIGHEST minimum wage in the country, has not suffered economically because of its high minimum wage. As I've stated, 29 states have enacted similar higher-than-federal wage laws. Show me ONE state that has suffered because of this.

Cite a specific case. For example, let's see what happened when Florida enacted an increase in their minimum wage above federal levels. One years later, employment levels were not negatively impacted.

In November of 2004, Floridians overwhelmingly voted to raise the state minimum wage above the federal level of $5.15. As of May 2, 2006, the newly approved law will have been in place for one year. The wage increased to $6.15 on May 2, 2005 and, because the voters approved an inflationary index, rose to $6.40 on January 1, 2006. In recognition of this anniversary, Florida ACORN commissioned this report to examine the economic health of the state after one year. Florida voters approved the measure despite dire predictions levied by opposition groups and public officials. The Florida Retail Federation claimed that “Jobs will be lost- devastating our strong economy.” Rick McAllister of the Retail Federation claimed a state minimum wage “could have a billion-dollar inflationary effect on the state of Florida.” The Orlando Chamber of Commerce predicted that the new minimum wage would lead to outsourcing, “many good Florida jobs will be shipped over seas”, and even cautioned that more “lawsuits will result. The amendment will create new opportunities for trial lawyers to make money by suing businesses.”

Some public officials actively opposed the measure. Senator Mel Martinez claimed the law would cause job loss, and Governor Jeb Bush also opposed it. Darrell Kelley, president of Enterprise Florida, claimed the raise could result in a decline in health benefits coverage. Finally, national opponents chimed in. Grover Norquist claimed that “Florida cannot afford the economic pain of job losses compounded with the inevitable increases in the costs of essential goods and services.”

One year later there appears to be no evidence supporting these claims. Ten months after the law took effect, Enterprise Florida reported that “Florida continues to lead the nation in job growth” and the state “ranks 5th in the nation in the total number of insourcing jobs.”

Read the study here in pdf format.

Washington state has a higher minimum wage than federal mandates require. So does Florida. Neither has suffered because of it.

Now it's your turn. Of the 29 states with higher minimum wage laws, show me ONE that has suffered. Get to it.

[Dardedar]

AND your source is some Republican "Talking Points." That's what it says on your source page.

DAR
Glad you caught that too.

[Hogeye]

Barbara, I didn't say that there would be no labor-saving advances without minimum productivity decrees. I said that mandating higher wages makes switching to lower-labor alternatives faster and more pervasive than would otherwise be the case. Employers are always weighing the alternatives of more labor less capital vs. less labor more capital. Obviously changes in labor (or capital goods) prices can change the equation. In Ozarkia we still have some full service gas stations that cater to older and handicapped people. Were there no minimum wage laws, there would likely be more.

Darrel, I generally prefer the more descriptive term "minimum productivity law" rather than the sugar coated statist term.

Doug, you say you don't understand the technical term "elasticity," but complain when someone gives an example.

OK, now you are changing your thesis yet again. You are now asserting that an increase in the minimum wage increases teenage unemployment. That was not your claim before.

No, I have been making the same claim all along - that minimum productivity laws increase unemployment among those with marginal productive skills.

I've already shown that Washington state, with the HIGHEST minimum wage in the country, has not suffered economically because of its high minimum wage.

No, you have simply quoted a government economic reporter saying that the raw unemployment number has not fallen. This does not imply that "economic suffering" (whatever that is) has not increased. It certainly does not imply that it hasn't been bad for the marginally productive. No systematic study has been done for Washington. With Washington (and now Florida), you are looking at employment among non-marginal people. Obviously minimum productivity laws don't effect software engineers or other people making significantly above minimum wage.

It is surprising how you ignore the many scientific studies I linked, and instead want to look at only raw unemployment data not corrected for the other factors affecting employment. Here's the bottom line:

The impact of raising the minimum wage has been studied since its inception. All credible research has come to the same conclusion: raising the minimum wage hurts the poor. It takes away jobs, keeps people on welfare, and encourages high-school students to drop out. (link

[Dardedar]

From The American Prospect

THE MINIMUM WAGE.
Every once in awhile, I like to reengage the minimum wage debate. It's such an article of faith on the right that minimum wage increases lead to widespread unemployment, and such an intuitive argument, that society would have to be a pretty bizarre place not to abandon the wrongheaded policy altogether. Except for the fact that, intuitive as the argument may be, and faithful as its rightwing advocates may prove, there's just not much evidence that minimum wage increases have a measurable effect on unemployment.

The foundational study in this area -- which various economists have sought to confirm or reject, all with varying, and often contradictory, success -- is the Card/Krueger survey of New Jersey restaurants that found a slight positive impact on employment. Lots of controversy on that result, but now there's new data from Arindrajit Dube, Suresh Naidu, and Michael Reich checking out San Francisco's restaurants after they instituted an $8.50 minimum wage. As Kash Mansori points out, the results are best explained in this graph, which also shows neighboring Alameda, which didn't have a minimum wage bill passed:



As Kash explains, "The minimum wage goes up in one place, but doesn't change right next door. Employment in restaurants goes up in both places - if anything, by more in the place where the minimum wage went up...Putting all of these different types of papers together, my conclusion is that the best evidence that labor economists can gather from US data seems to indicate that we need not fear major employment losses if we were to increase the minimum wage. The effects may be slightly negative for teenagers, but overall the effect on jobs may be zero to even slightly positive."

Meanwhile, the invaluable folks at EPI have a briefing paper on the likely impacts of raising the national minimum wage to $7.25. For all the talk of teenagers and so forth, 80% of the 15 million affected workers would be older than 20, $7.3 million children would see their parent's income rise (46% of families with a mniimum wage worker rely mainly on that income), and so forth. Well worth a read.

Update: Relatedly, here's a recent letter signed by over 650 economists, including five nobel prize winners and six past presidents of the American Economic Association calling for an increase in the minimum wage. That's not to say opponents of an increase couldn't furnish a similar letter -- the point here is that there is not, as the right would like you to think, an economic consensus that raising the wage would be a bad thing.

--Ezra Klein

DAR
So raising minimum wage can increase employment. Interesting. Make sure and give this link a peruse.

D.

[Doug]

Doug, you say you don't understand the technical term "elasticity," but complain when someone gives an example.

DOUG
I have no idea what you are saying here. I asked you to show the significance of your comment on "elasticity." I didn't say I didn't understand. I also see that you still haven't shown the significance of your comment. And I did not complain that you gave an example.

OK, now you are changing your thesis yet again. You are now asserting that an increase in the minimum wage increases teenage unemployment. That was not your claim before.

No, I have been making the same claim all along - that minimum productivity laws increase unemployment among those with marginal productive skills.

DOUG
Well, you have not shown that at all. You did cite something about teens specifically, but not "those with marginal productive skills."

I've already shown that Washington state, with the HIGHEST minimum wage in the country, has not suffered economically because of its high minimum wage.

No, you have simply quoted a government economic reporter...

Stop spinning the evidence. The guy is a trained and degreed economist, not a "reporter."

...saying that the raw unemployment number has not fallen. This does not imply that "economic suffering" (whatever that is) has not increased.

He said he can find no evidence of negative effects resulting from the higher minimum wage.

YOU claim that there should be negative effects.

So it is incumbent upon YOU to show those effects.

So get to showing them. I'm still waiting.

Pick just ONE of the 29 states that have minimum wages higher than federal mandates levels, and show that it has suffered because of its higher minimum wage.

Either produce the evidence or admit that you are incorrect.

[Barbara Fitzpatrick]

Speaking as someone who worked minimum wage jobs from age 15 until age 29 (and then got hit with minimum wage jobs again when I moved to Arkansas at age 32), increases in minimum wage did not result in loss of jobs for ANYBODY in the companies I worked for. What it did result in was the ability to get more protein with the groceries, a second pair of shoes, and - during those younger years when I was providing the groceries while my single-parent mom was paying for everything else - school supplies and the only Christmas presents under the tree for my four younger siblings.

[Hogeye]

Doug, here is the list of studies (again). Real studies - not just raw unemployment numbers with naive conclusions, like your Washington and Florida anecdotal "evidence."

Summary of Research on the Minimum Wage

The minimum wage reduces employment.

Currie and Fallick (1993), Gallasch (1975), Gardner (1981), Peterson (1957), Peterson and Stewart (1969).

The minimum wage reduces employment more among teenagers than adults.

Adie (1973); Brown, Gilroy and Kohen (1981a, 1981b); Fleisher (1981); Hammermesh (1982); Meyer and Wise (1981, 1983a); Minimum Wage Study Commission (1981); Neumark and Wascher (1992); Ragan (1977); Vandenbrink (1987); Welch (1974, 1978); Welch and Cunningham (1978).

The minimum wage reduces employment most among black teenage males.

Al-Salam, Quester, and Welch (1981), Iden (1980), Mincer (1976), Moore (1971), Ragan (1977), Williams (1977a, 1977b).

The minimum wage helped South African whites at the expense of blacks.

Bauer (1959).

The minimum wage hurts blacks generally.

Behrman, Sickles and Taubman (1983); Linneman (1982).

The minimum wage hurts the unskilled.

Krumm (1981).

The minimum wage hurts low wage workers.

Brozen (1962), Cox and Oaxaca (1986), Gordon (1981).

The minimum wage hurts low wage workers particularly during cyclical downturns.

Kosters and Welch (1972), Welch (1974).

The minimum wage increases job turnover.

Hall (1982).

The minimum wage reduces average earnings of young workers.

Meyer and Wise (1983b).

The minimum wage drives workers into uncovered jobs, thus lowering wages in those sectors.

Brozen (1962), Tauchen (1981), Welch (1974).

The minimum wage reduces employment in low-wage industries, such as retailing.

Cotterman (1981), Douty (1960), Fleisher (1981), Hammermesh (1981), Peterson (1981).

The minimum wage hurts small businesses generally.

Kaun (1965).

The minimum wage causes employers to cut back on training.

Hashimoto (1981, 1982), Leighton and Mincer (1981), Ragan (1981).

The minimum wage has long-term effects on skills and lifetime earnings.

Brozen (1969), Feldstein (1973).

The minimum wage leads employers to cut back on fringe benefits.

McKenzie (1980), Wessels (1980).

The minimum wage encourages employers to install labor-saving devices.

Trapani and Moroney (1981).

The minimum wage hurts low-wage regions, such as the South and rural areas.

Colberg (1960, 1981), Krumm (1981).

The minimum wage increases the number of people on welfare.

Brandon (1995), Leffler (1978).

The minimum wage hurts the poor generally.

Stigler (1946).

The minimum wage does little to reduce poverty.

Bonilla (1992), Brown (1988), Johnson and Browning (1983), Kohen and Gilroy (1981), Parsons (1980), Smith and Vavrichek (1987).

The minimum wage helps upper income families.

Bell (1981), Datcher and Loury (1981), Johnson and Browning (1981), Kohen and Gilroy (1981).

The minimum wage helps unions.

Linneman (1982), Cox and Oaxaca (1982).
The minimum wage lowers the capital stock.

McCulloch (1981).

The minimum wage increases inflationary pressure.

Adams (1987), Brozen (1966), Gramlich (1976), Grossman (1983).

The minimum wage increases teenage crime rates.

Hashimoto (1987), Phillips (1981).

The minimum wage encourages employers to hire illegal aliens.

Beranek (1982).

Few workers are permanently stuck at the minimum wage.

Brozen (1969), Smith and Vavrichek (1992).

The minimum wage has had a massive impact on unemployment in Puerto Rico.

Freeman and Freeman (1991), Rottenberg (1981b).

The minimum wage has reduced employment in foreign countries.

Canada: Forrest (1982); Chile: Corbo (1981); Costa Rica: Gregory (1981); France: Rosa (1981).

Characteristics of minimum wage workers

Employment Policies Institute (1994), Haugen and Mellor (1990), Kniesner (1981), Mellor (1987), Mellor and Haugen (1986), Smith and Vavrichek (1987), Van Giezen (1994).

[Doug]

DOUG
I appreciate the effort, Hogeye. However, I'm not going to hunt down all of those studies and see whether there is anything to them.

YOU are making the claim, so YOU do it. I have already cited economists (not "reporters") who have examined Florida and Washington and found that the higher minimum wage did NOT have negative effects.

So do what I have already suggested:

Pick just ONE of the 29 states that have minimum wages higher than federal mandates levels, and show that it has suffered because of its higher minimum wage.

[Hogeye]

I gave you 54 scientific studies; you gave me zero studies. (Opinions based on raw general unemployment data are not studies, as already noted.) My claim that minimum productivity laws increase unemployment among the marginally productive is amply supported.

Doug, you seem to give insufficient consideration to three points. First, you seem inclined to favor quick informal judgements based on general unemployment data over real studies. As noted, most people in the employment pool make significantly more than minimum wage, and thus overwhelm the subset we are concerned with - the marginally productive. Also, such raw numbers fail to take into account the larger trends, or the various other factors effecting employment rates. Second, you seem obsessed with state-wide studies rather than various other, better samples. You apparently don't wish to consider the plethora of studies already done, since the experts don't use your preferred experimental model. Third, you continue to formulate the issue using the uselessly fuzzy "suffered" (because of its higher minimum wage). "Suffering" is of course too vague. Let's operationalize it with higher unemployment among marginally productive people. And that is already well established per the many studies.

[Doug]

I gave you 54 scientific studies...

DOUG
No, you dropped names. SHOW one study that indicates that your claim is correct.

you gave me zero studies. (Opinions based on raw general unemployment data are not studies, as already noted.)

DOUG
Oh, so now the trained, degreed economist who could not find any negative effects of the HIGHEST minimum wage in the country, in Washington state, is just giving his "opinion"?

My claim that minimum productivity laws increase unemployment among the marginally productive is amply supported.

Maybe so. But not on this forum. You dropped names and cited a study of teenagers, but you have not shown me evidence that minimum wage laws above federal mandates increase unemployment.

Here is the challenge you face:

Pick just ONE of the 29 states that have minimum wages higher than federal mandates levels, and show that it has suffered because of its higher minimum wage.

Either produce the evidence or admit that you are incorrect.

[Hogeye]

I gave 54 studies. I gave praxeological rationale that explains the process. Admit that I've supported my claim.

Frivolously asking for a study that suits your arbitrary conditions doesn't magically make those 54 studies disappear. I don't arbitrarily reject e.g. global temperature data, demanding instrumental temperature readings in every 100 square mile cell on earth for the late 50 years. One has to look at the research available, not demand research that hasn't been done!

BTW my claim is that minimum productivity laws increase unemployment among the marginally productive. I have said nothing about wages being higher or lower than federal mandates. My claim implies that both federal and state wage price-fixing (above the equilibrium price) increases unemployment. And again, I have made no claims about the totally subjective notion of harm; my claim is about a relationship between minimum productivity laws and involuntary unemployment.

[Doug]

I gave 54 studies...

Nope. Dropping 54 names is not good enough.

Pick just ONE of the 29 states that have minimum wages higher than federal mandates levels, and show that it has suffered because of its higher minimum wage.

I've challenged you to do this, and you have not done it.

You lose.