Minimum Wage

Proposition: Any increase in the minimum wage will simply be passed down to the consumer or increase unemployment.

Corporations may pass wage increases down to their customers, or they may not, depending the particular market in which the corporation is operating.

In a closed market in which a limited number of producers control the product price then increased costs will be passed down to the end user. Big oil is an example of this condition.

If, on the other hand, the market has a multitude of producers the most efficient corporations may absorb increased costs of production in order to gain market share and thus increase earnings. Fast food is an example of this condition.

In competitive or elastic markets the investors and managers may have to absorb increased costs in order to maintain a price point that will attract consumers.

The idea that fast food and other labor intensive enterprises will shed workers if wages are increased fails the logic test. If they are able to get by with less employes why are they paying them now at current wages.

Paul Hunter paulhunter45177@gmail.com