Review & Outlook. Seattle's Minimum-Wage Education
by: Editorial Staff
Aug 15, 2016
Click here to view the full article on WSJ.com
by: Editorial Staff
Aug 15, 2016
Click here to view the full article on WSJ.com
TOPICS: Labor Economics
SUMMARY: When a wage floor goes up, hours worked and employment go down.
CLASSROOM APPLICATION: The article informs students about the effect of an increase in the minimum wage on employment levels. The article also notes the difficulty economists have in disentangling the effect of changes in the demand and supply for labor and the effect of the minimum wage on employment levels.
QUESTIONS:
1. (Advanced) What is the effect of an increase in the minimum wage on employment? How does the answer depend on the wage elasticities of demand for labor?
2. (Advanced) How would economists disentangle the effect of changes in the demand and supply for labor and the effect of the minimum wage on employment levels?
3. (Introductory) According to the editorial, what is the best route to higher wages?
1. (Advanced) What is the effect of an increase in the minimum wage on employment? How does the answer depend on the wage elasticities of demand for labor?
2. (Advanced) How would economists disentangle the effect of changes in the demand and supply for labor and the effect of the minimum wage on employment levels?
3. (Introductory) According to the editorial, what is the best route to higher wages?
Reviewed By: James Dearden, Lehigh University
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