Most economists will argue that the minimum wage causes unemployment. Even politicians will recognize this when pressed
However, typically liberals will tout the benefits of the minimum wage while conservatives will decry the disruption that it causes in the labor market. Which economic objective seems to be more important for liberals and which is more important to conservatives if this general observation is correct? Which side is right?
If this general observation is correct then it would seem that liberals are more concerned with equity and conservatives are more concerned with efficiency. Neither side is right. That is a normative question. The reason is that there is a tradeoff between equity and efficiency. Which one you want more of is a question of your values.
You might also like to view...
For a natural monopoly, the marginal cost of producing an additional unit of its product is relatively small
Indicate whether the statement is true or false
A nation's total external wealth is calculated as:
A) the sum of total assets minus total liabilities expressed in local currency. B) total assets expressed in foreign currency minus total liabilities expressed in foreign currency. C) the sum of total assets minus total liabilities expressed in foreign currency. D) the sum of physical assets within the nation, domestic stock market capitalization, and government assets minus total liabilities.
Accounting profits are
A) total revenue minus explicit costs. B) total revenue minus implicit costs. C) total revenue minus explicit and implicit costs. D) total revenue minus normal costs.
Why are the long-run effects of an increase in aggregate demand on price and output different from the short-run effects?
What will be an ideal response?