So the real question is, does the benefit of having higher wages for hired employees outweigh the cost of the amount fired because of the minimum wage? The answer is no, illustrated by Deadweight loss
Well Moriarty we are friends and I am going to keep this friendly. You are reading texts. You seem to have little or no real life experience, but you are a smart guy. All people have basic needs. They need food and shelter or they become street people and unemployable. Some have mental illnesses that also makes them difficult to manage. Not all people are born with the ability to understand complex concepts, set goals and achieve independence. They cannot bargain for wages as they have no marketable skills with which to bargain. So this is why we need government intervention. For a lot of reasons that I have defined above. Maybe your professor and classmates will laud you for such a precise examination of the minimum wage, but this will change. Can you apply your same premise to the Australian minimum wage that is near 15.00?
Koko we can't all just get along as the middle class is getting downsized constantly. We may as well be migrant corporate workers. Buy a house, get the kids settled in good schools, the wife has a job and then corporate says we are opening a new office in Utah and if you say no you are done. So you pack up start all over again and 5 years or less they are bought out. Your job is gone and you have a home, two car payments kid's getting ready to go to college and no money and you're in Utah.
So your choices are move again. Stay and hope you can find a job and most likely end up with a 20% paycut and work a part time job at night. Never seeing your wife and kids. Worse yet she has an unexpected pregnancy and has to quit her job because the United States doesn't offer maternity leave over 6 weeks and the kids have to sign loans to go to college. That my friends is "The Real World." The one we live in that is not in a economics book.
Moriarty what do you intend on doing with your degree? Go on to get and MBA? Go to work for Wall Street? Work in Silicon Valley? Do you think my scenario can't happen to you? What if you get a girl pregnant? Abortion or drop out of school to support her and the kid? Suppose you find out you have a disease or an accident that will take it all away. Life is not perfect and some people have a hard time making it month to month. What is it like in your world?
Astros if you could tell the President to change something that you don't agree with in regards to economic policy what might that be? How should we make it more conservative?
Edited by QueenofHearts, 13 February 2016 - 07:45 PM.