Raise That Wage
By PAUL KRUGMAN
President Obama laid out a number of good ideas in his State of the Union address. Unfortunately, almost all of them would require spending money — and given Republican control of the House of Representatives, it’s hard to imagine that happening.
Nutshell: More ideas require more spending money
One major proposal, however, wouldn’t involve budget outlays: the president’s call for a rise in the minimum wage from $7.25 an hour to $9, with subsequent increases in line with inflation. The question we need to ask is: Would this be good policy? And the answer, perhaps surprisingly, is a clear yes.
Nutshell: Rise in minimum wage is a good policy
Why “surprisingly”? Well, Economics 101 tells us to be very cautious about attempts to legislate market outcomes. Every textbook — mine included — lays out the unintended consequences that flow from policies like rent controls or agricultural price supports. And even most liberal economists would, I suspect, agree that setting a minimum wage of, say, $20 an hour would create a lot of problems.
Nutshell: Legislating market outcomes have consequences
But that’s not what’s on the table. And there are strong reasons to believe that the kind of minimum wage increase the president is proposing would have overwhelmingly positive effects.
Nutshell: Rise in minimum wage has great benefits
First of all, the current level of the minimum wage is very low by any reasonable standard. For about four decades, increases in the minimum wage have consistently fallen behind inflation, so that in real terms the minimum wage is substantially lower than it was in the 1960s. Meanwhile, worker productivity has doubled. Isn’t it time for a raise?
Nutshell: Minimum wage has been low for a while
Now, you might argue that even if the current minimum wage seems low, raising it would cost jobs. But there’s evidence on that question — lots and lots of evidence, because the minimum wage is one of the most studied issues in all of economics. U.S. experience, it turns out, offers many “natural experiments” here, in which one state raises its minimum wage while others do not. And while there are dissenters, as there always are, the great preponderance of the evidence from these natural experiments points to little if any negative effect of minimum wage increases on employment.
Nutshell: Rarely any negative effects on raising minimum wage
Why is this true? That’s a subject of continuing research, but one theme in all the explanations is that workers aren’t bushels of wheat or even Manhattan apartments; they’re human beings, and the human relationships involved in hiring and firing are inevitably more complex than markets for mere commodities. And one byproduct of this human complexity seems to be that modest increases in wages for the least-paid don’t necessarily reduce the number of jobs.
Nutshell: Increase in wages don’t reduce jobs
What this means, in turn, is that the main effect of a rise in minimum wages is a rise in the incomes of hard-working but low-paid Americans — which is, of course, what we’re trying to accomplish.
Nutshell: Rising minimum wage effects incomes of low-paid Americans
Finally, it’s important to understand how the minimum wage interacts with other policies aimed at helping lower-paid workers, in particular the earned-income tax credit, which helps low-income families who help themselves. The tax credit — which has traditionally had bipartisan support, although that may be ending — is also good policy. But it has a well-known defect: Some of its benefits end up flowing not to workers but
newspaper. The Arab newspaper is widely available throughout Riyadh , and thus my students would have easy access to this newspaper. This lesson is designed to encourage students to read from local newspapers and to keep themselves up to date with the local news. The skills that I decided to focus on is reading (receptive), writing (productive) and speaking (productive) because I believe that this lesson will give students an opportunity as well as a confidence booster to practise reading and inferring…
Material Ryan Levin November 7, 2012 Life Resource Center Scavenger Hunt Worksheet The Life Resource Center (LRC) is a valuable free tool available to University of Phoenix students. Taking some time to explore this website to discover some of the many topics, resources, and tools available is a great way to find information to enhance health and wellness. Login to the student website. Click on the Programs tab at the top of the page, and then on Life Resource Center under Services. Explore…
formal learning for students choosing the option to study further after secondary education. Ideas about how higher education should be systemized have been long discussed by many philosophers. Philosophers have argued on how the university should function and, essentially, what type of student they are hoping to produce. The outcome of the student’s matters to the university, probably far more than it matters when they were attending the university. The outcomes allow incoming students to picture what…
Your school is considering making Spanish language a mandatory class for students each year because of the demographic changes in the United States. Students already fluent in Spanish may enroll in Spanish literature courses. Write a letter to your school board that takes a position and either supports the mandatory Spanish language classes or not. Do you want to waste your time for a language you do not want to learn? Anyone would love to learn the language of his or her choice. If Spanish is a…
School Life School life is very important part of one's life, because it provides opportunity for study and discipline. Besides these, the school life is a preparatory stage for entering public life. School plays an important role in widening the outlook of students. Virtues such as perseverance, sincerity, truthfulness, tolerance, discipline and obedience developed in pupils. School provides opportunity to the students to be disciplined. They show discipline in class room, playground, hostel,…
English 13 22 February 2013 Summary of “Life in the Dorms” In chapter two, “Life in the Dorms”, Rebekah Nathan found that despite the university’s attempt to create community among the students, variety, options and cultural themes of individual freethinking and fun created a wide range of diverse students with little in common. The week before classes started Nathan began to take notescensus of the students in the dorm and how they, and the university, presented themselves. She was surprised…
stress are college students because they have many things to do at the same time. Students have to balance their course work and family at the same time, and they have to leave their family problems in their home to be able to concentrate carefully on their course work. The university life has become a lot more challenging, and it’s much harder than school. I think being in college can be extremely stressful because students have to do everything by themselves. Furthermore, students have many assignments…
to produce results collected from the University Students. This report will cover a diversity of data, which may include number of societies, age and gender of the University Students being surveyed. The survey main focus was set for the first year students, as the university’s goal was to get findings on the student’s life at university and how they have overcame different situations through adapting themselves to the environment. 152 students took part in the survey. There are some specific…
Education The Current Situation of Learning and Life of Students Changing Majors in Universities under the Multi-Campus University Mode and Existing Problems – Taking Students Changing Majors in Sichuan Agricultural University as a Case Study Yu Li1 & Weibin Li2 1 The Student Work Department, Sichuan Agricultural University, Chengdu, China 2 College of resources and environment, Sichuan Agricultural University, Chengdu, China Correspondence: Yu Li, The Student Work Department, Sichuan Agricultural University…
Stress Kind of Stress 2/15/2013 Alexis D. Sanchez EAP1540 - 724594 Renee Zelden Stress At this time the most common health disease in the modern world is stress special in college student. I think they have compact schedules, so every day more students suffer stress. Stress has been classified in to three types academic, financial, and personal stress. One type of stress is academic, this is relevant whit work and study at the same time, imply a big concentration in your…