Leading Economists Vote on Raising the Minimum Wage
I’m delighted to see the U Chicago IGM Forum ask a really useful, non-softball question.
The panelists are evenly split on whether an increase to $9 would make it “noticeably harder for low-skilled workers to find employment.”
A 4:1 majority thinks that weighing the costs and benefits, “this would be a desirable policy.”
I note how many who commented bring up the EITC, suggesting that an increase in that support might be better than a minimum-wage increase.
I note further that they apparently haven’t read the very good reasoning and research suggesting that the two together very effectively address the problems of each.
But Paul Krugman has. And his surprise helps explain why the others haven’t thought about this:
Second — and this is news to me — the usual notion that minimum wages and the Earned Income Tax Credit are competing ways to help low-wage workers is wrong. On the contrary, raising the minimum wage is a way to make the EITC work better, ensuring that its benefits go to workers rather than getting shared with employers. This actually is Econ 101, but done right
Cross-posted at Angry Bear.