The Effects of a Change in the Minimum Wage Essay -- Economics Workfor

The Effects of a Change in the stripped wage In 1938, the Fair labour party Standards Act was passed and ever since, the United States has necessary that altogether trues that do at least $500,000 worth of business per family pay their workers a minimal wage (Handy n.pag.). Because it affects so some(prenominal) workers in so many different aspects of the economy, the minimum wage plays a big part in the cost of labor and how firms deal with those costs. A change in the minimum wage, which would seemingly affect only workers, spate actually be felt sometimes all the way take to the consumer, who index end up paying for it in the endunless the firm finds another way to pay for the mandatory raise for all its workers, such as a decrease in its workforce or a change in the production process. These changes the consumer might not noticeably feel. A change in the minimum wage has several short-term and long-run effects on the economy that can be either practiced or devast ating to society at large.The arguments for and against the minimum wage apply been ongoing. On one hand, its plainly a supply and learn issue. As prices (or wages) rise, the demand for that product (or labor) decreasesin other words, employers will simply stop or slow down their hiring. If the minimum wage pluss also much, then it could even force some smaller firms out of business. then(prenominal) even more people will be out of work. On the other hand, better paid employees could feel more motivation to increase their productivity. And increase in a companys productivity could be high enough that, in order to keep up supply, it might need to hire even more employees. In this case, raising the minimum wage has increased employment.So whos right? Almost all studies of minimum wage ef... ...Handy Reference Guide. ESA/WHD Wage Hour persona Home Page. U.S. Department of Labor. 21 April 2001 .Neumark, David and William Wascher. Employment Effects of Minimum and Subminimum pro ceeds Panel Data on State Minimum Wage Laws. industrial & Labor Relations Review Oct 1992 55. EBSCOhost MasterFILE Premier. 22 April 2001 .Partridge, Mark D. and Jamie S. Partridge. Do Minimum Wage Hikes Reduce Employment? State-Level Evidence from the Low-Wage Retail Sector. diary of Labor Research Summer 1999 393. EBSCOhost MasterFILE Premier. 22 April 2001 .Wimmer, Bradley S. The Minimum Wage and Productivity Differentials. Journal of Labor Research Fall 2000 649. EBSCOhost MasterFILE Premier. 22 April 2001 .