Zeynep Tons A Minimum Wage Essay -- elastic supply, demand, employees

The term that I am watch is Zeynep Tons A marginal wage hike could help employers, too, in the Harvard melodic line Review. This article is a speculative piece about the effects of proposed token(prenominal) wage increases at the federal level. The former takes a look at companies that superior wages and benefits for their industry. The underlying theme is that this is juxtaposed against a frequent argument that raising the nominal wage allow for be universally harmful. The common argument takes beginners level supply and demand graphs and uses them as the keister for the claim. The basic elastic supply and demand graph shows that as the represent of a good increases, demand for that good declines. Thus, if the minimum wage increases, businesses will face higher costs, will pass those costs onto consumers, will fetch lower profits or will reduce employment, or any(prenominal) combination of these negative outcomes. The root here is pointing out that the world is a heck of a lot more complex than that. Microeconomics does not end with the study of rudimentary supply and demand graphs, but incorporates a broader range of considerations into its arguments. The author highlights a couple of those arguments. The first is the good jobs strategy. The second is the might concept. The two ar at times related. First, microeconomic principles can be used to examine the good jobs strategy. The author cites four firms in grumpy Trader Joes, Costco, Spanish supermarket chain Mercadona and convenience store chain QuikTrip. The author acknowledges that these companies do not have too many similarities, perhaps eject for the nature of the goods they sell they are all in convenience and nutrient retailing. This industry is characterized by a st... ...vers. Better people wont work for minimum wage, but go people make for stronger companies. And what of customers? There are terms elasticities of demand to consider in this argument. They a re not relevant at Costco, and Trader Joes is good value for its competitive niche, but many Americans are perfectly willing to pay a higher price for better quality. Yes, there are other considerations not mentioned here the effect of minimum wage on overall inflation and things like that but the article is a great starting point for understanding the complexity of microeconomic analysis that goes beyond the superficial analysis we often see in the media. Works CitedTon, Z. (2014). A minimum wage hike could help employers, too. Harvard descent Review. Retrieved February 2, 2014 from http//blogs.hbr.org/2014/01/a-minimum-wage-hike-would-help-employers-too/