Thursday, November 30, 2006
The Minimum Wage: Economists' Views
Greg Mankiw posts about Robert Whaples' survey of PhD members of the American Economic Association. On the minimum wage, it turns out that "37.7 percent want it increased, while 46.8 percent want it eliminated." It's interesting to compare this finding to the one that 87.5 percent agree that "the U.S. should eliminate remaining tariffs and other barriers to trade." Both trade barriers and the minimum wage have similar effects: More money to a select few, with most of the country paying a little bit more and efficiency diminished. Yet somehow a large number of economists are in favor of increasing the minimum wage, whereas only a handful would keep trade barriers.