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pjp
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PostPosted: Fri Nov 30, 2012 12:20 am    Post subject: Reply with quote

Less demand, higher costs, less patronage, etc. It will likely come to an equilibrium, but it could mean fewer jobs, or the owner closing down.
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dmitchell
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PostPosted: Fri Nov 30, 2012 3:14 am    Post subject: Reply with quote

juniper wrote:
so what will happen? the pizza business will lose some money, there will be a small percentage of layoffs. However, people are likely not going to eat less. So, while wages at the local grocery store will rise, their product will still be an attractive alternative to the slightly higher priced pizza. They may be hiring.

It's possible, but you've moved the goal posts. We were discussing the effect on a hypothetical pizza business, remember? You said a price floor on labor didn't necessarily mean less labor purchased because the pizza business could simply charge more. You seem to have backed off that claim, and are now arguing that maybe people will find work in the pizza alternatives industry. Of course those industries are in the exact same situation as the pizza business.
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BonezTheGoon
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PostPosted: Fri Nov 30, 2012 4:52 am    Post subject: Reply with quote

dmitchell wrote:
juniper wrote:
so what will happen? the pizza business will lose some money, there will be a small percentage of layoffs. However, people are likely not going to eat less. So, while wages at the local grocery store will rise, their product will still be an attractive alternative to the slightly higher priced pizza. They may be hiring.

It's possible, but you've moved the goal posts. We were discussing the effect on a hypothetical pizza business, remember? You said a price floor on labor didn't necessarily mean less labor purchased because the pizza business could simply charge more. You seem to have backed off that claim, and are now arguing that maybe people will find work in the pizza alternatives industry. Of course those industries are in the exact same situation as the pizza business.


Hang on there tiger, we're in OTW here -- you need to slow down with the reasonable talk, and start throwing things instead of making well phrased points.
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juniper
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PostPosted: Fri Nov 30, 2012 10:06 am    Post subject: Reply with quote

dmitchell wrote:
juniper wrote:
so what will happen? the pizza business will lose some money, there will be a small percentage of layoffs. However, people are likely not going to eat less. So, while wages at the local grocery store will rise, their product will still be an attractive alternative to the slightly higher priced pizza. They may be hiring.

It's possible, but you've moved the goal posts. We were discussing the effect on a hypothetical pizza business, remember? You said a price floor on labor didn't necessarily mean less labor purchased because the pizza business could simply charge more. You seem to have backed off that claim, and are now arguing that maybe people will find work in the pizza alternatives industry. Of course those industries are in the exact same situation as the pizza business.


the original discussion was about the effect of minimum wage on the broader rate of employment. Were the goal posts moved? Perhaps slightly.

Indeed, all those industries are in the same boat. So where will the money go? Where will the employment go? I think the analysis that jobs at the bottom will simply be lost doesn't take into account large employers depressing wages and the dynamism of the economy. Things will shift. It's a new constraint, and a minor one at that. Think about other economic shocks. If a tanker spills all it oil or if OPEC cuts supply or supply just goes down because of El Nino, employment isn't forever lost by the price shock (after all, if the price of gas goes up, EVERYTHING goes up in price). The economy adjusts. Have some faith in free markets, man. They're a wonderful thing. :lol:

Of course, the immediate damage of the shock can be bad. If you read the article I posted, it had good things to say about britain (which incrementally raises its minimum wage over time) and bad things about America (which tends to have large shocks on account of infrequent large increases).
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pjp
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PostPosted: Fri Nov 30, 2012 3:04 pm    Post subject: Reply with quote

juniper wrote:
bad things about America (which tends to have large shocks on account of infrequent large increases).
I've never read of a "bad thing" or "shock" as a result of infrequent increases to minimum wage.

If I'm not mistaken, the last time it was increased (or a recent time anyway), it was done incrementally over several years.
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