Aggregated Data Hides the Damage Done by Minimum Wage Hikes
03/05/2021Gary Galles
Democrats are again pushing to increase the federal minimum wage, this time roughly doubling it to $15 per hour. And as with every such push, that has involved invoking “rosy scenario†sales pitches about how low-wage workers will be big winners.
However, such “help the poor†claims must confront the fact that, as labor economist Mark Wilson put it, “evidence from a large number of academic studies suggests that minimum wage increases don’t reduce poverty levels.†If higher minimum wages are supposed to help the poor, why don’t poverty rates fall?
One of the reasons is that minimum wage advocates ignore major harms they would impose on the poor, which is hard to justify by the desire to help the poor.
Much of the harm is disguised by focusing on forecasts of higher aggregate income for the poor.
https://mises.org/wire/aggregated-data-hides-damage-done-minimum-wage-hikes
