Uncensored2008
Libertarian Radical
- Feb 8, 2011
- 110,434
- 39,503
The point is that the labor cost was already more than the minimum wage , (i.e. it had no impact on the labor costs in the analysis), thus disqualifying the minimum itself as any real catalyst for the move to self-service.
And I ignored your usher example because it's a load of shit. My cinema has a many of them.
Not true.
What you fail to account for is that labor is a commodity.
If Minimum is $7.25 and there is a manufacturing shop, paying $9 to start for production labor. Because the work is hot and hard, the shop must pay more to attract qualified workers.
Raise minimum to $9 an hour, and you would claim this has no impact on the manufacturing firm - but you're wrong. Because the labor pool will gravitate to McDonalds where it's air conditioned and they don't have to work very hard, considering the pay is now the same. The manufacturing shop will have no choice but to increase wages, which will roll into the cost of the product. And of course upstream shops will also have to raise wages and prices. Murray Rothbard demonstrated that it takes about 3 years to shake out, but the purchasing power of the minimum wage earner will return to what it was before the raise - in fact MUST return, based on the laws of equilibrium.
Raising the minimum wage is done to buy votes, it does absolutely nothing to improve the fortunes of the wage earner.