If you read Businessweek’s pro-minimum wage plea, be sure to follow up with a dose of common sense

It’s not enough that Bloomberg Businesweek‘s Peter Coy labels as “careful research” the widely discredited Card-Krueger study on the impact of a government-mandated minimum wage; Coy also dismisses as “grumpy” those experts who apply real analysis to the issue, rather than feel-good sentimentality.

[J]ust as war is too important to be left to the generals, the minimum wage is too important to be left to the Ph.D.s. Many people view the wage floor as a statement about the worthiness of work itself—a sense that Obama got at in 2013 when he said no one working full-time in the wealthiest nation on earth should have to live in poverty. The declaration rings true to a lot of people, even if a grumpy economist would say, “Well, that all depends on the marginal product of labor.”

One might also say that economic analysis is too important to be left to those ignorant of economics. For a more realistic assessment of the likely outcome of an increase in the government-mandated minimum wage, you might want to check out Roy Cordato’s recent analysis of the topic.

One comment

  1. Labeling the Card-Krueger research as “widely discredited” is laughably incorrect:

    http://www.cepr.net/index.php/blogs/cepr-blog/singing-together-but-all-off-key

    You can certainly make the case that minimum wage laws are an affront to liberty; attempting to buttress this argument with junk economics serves no purpose whatsoever.

    Regardless of how you might feel about the ideology of min wage laws, anyone curious about the actual economic science on the matter should check out this interesting and nuanced overview:

    http://www.cepr.net/documents/publications/min-wage-2013-02.pdf.

    Comment by Randy Seven on February 20, 2014 at 6:13 pm

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