“In March, every Republican in the House voted against a measure to raise the minimum wage. ‘When you raise the price of employment, guess what happens? You get less of it, said Speaker John Boehner in February, espousing a party-line theory that most economists agree has been discredited.” New York Times editorial, Jan. 2, 2014.
Caroline Baum replies:
This is one of the more outrageous political statements dressed up as economic theory from the editorial board of the New York Times. They should be ashamed of themselves.
Economists David Neumark and William Wascher reviewed more than 100 studies on the minimum wage in a 2006 paper for the National Bureau of Economic Research: “Minimum Wages and Employment: A Review of Evidence from the New Minimum Wage Research.” Here’s a summary of their findings: “The oft-stated assertion that recent research fails to support the traditional view that the minimum wage reduces the employment of low-wage workers is clearly incorrect.” What’s more, almost all the papers they reviewed “point to negative employment effects” for the U.S. and many other countries. The effect is greater for low-skilled workers, whom the minimum wage is designed to help. Overall, the authors found very little evidence of positive effects from raising the minimum wage.