Some Questions for Minimum-Wage Proponents

by Don Boudreaux on December 2, 2013

in Reality Is Not Optional, Seen and Unseen, Work

Here are some questions for proponents of a legislated minimum wage:

- Suppose (not unreasonably) that poor people are disproportionately likely, compared to wealthier people, to own high-mileage used cars produced, say, between 1989 and 1995.  And assume that the average price at which poor people sell each of these cars (when, say, they want to buy newer cars, or when they choose to rely more heavily upon public transportation) is $3,000.  Do you support minimum-used-car-price legislation that prohibits the sale of any car at a price of less than $5,000?  Do you believe that such legislation would make poor people richer?  Would your answer change if the legislated minimum price for cars is $3,250 rather than $5,000?  (I proposed a similar thought experiment back in June 2006.)

- Other than low-skilled labor, what other goods or services can you think of that warrant enormous amounts of empirical studies to determine the direction of the effect that mandated higher prices for those goods and services will have on the quantities of those goods and services that buyers wish to purchase?  Or is low-skilled labor the only good or service that you can think of for which it is unscientific or mistaken to suppose that, all other things unchanged, the higher is the price that buyers must pay for this product, the fewer are the quantities of this product that buyers wish to purchase?

Asked differently: Is it unscientific for protectionists to reason that higher tariffs on imported steel or sugar or automobiles or shoes will reduce (from what they would otherwise be) the quantities of these things that buyers wish to purchase?  Is it unscientific for nanny-state government officials to reason that higher taxes on cigarettes will lower the quantity demanded of cigarettes?  Is it unscientific for opponents of immigration to propose, in hopes of reducing the employment of undocumented immigrants, higher penalties on firms that employ undocumented immigrants?  Is it unscientific for proponents of rent-control to insist that, if the rents that tenants must pay for rental apartments rise, fewer people will be in the market to rent apartments?  Are National Football League officials unscientific dolts when they assume that increasing the fines for helmet-to-helmet hits will reduce the frequency of such hits?

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