April 10, 2017

35. Do minimum wages reduce inequality?

Mark Perry, Professor of Economics and Finance at the University of Michigan, believes that raising the minimum wage will push costs up so high companies won’t be able to afford them. He wrote in his blog, “a $15 minimum wage maximizes the probability that an unskilled worker will be unemployed at $0.00 an hour instead of being gainfully employed”. So, is that the case? Prof DSteve Keen argues he is making the mistake of many economists, applying a micro-economic argument to macro-economics. Find out how the Michigan professor got it so wrong.

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