Barry Ritholtz: What Minimum-Wage Foes Got Wrong About Seattle

Barry Ritholtz What Minimum Wage Foes Got Wrong About Seattle

Barry Ritholtz: What Minimum-Wage Foes Got Wrong About Seattle: “An initial study said the increase to $15 would cost workers jobs and hours. That didn’t happen…. The increase was an ‘economic death wish’ that was going to tank the expansion and kill jobs, according to the sages at conservative think tanks. The warnings were as unambiguous as they were specific…

…Alas, if only the critics has done their homework first, instead of using scare tactics. Much of the hand-wringing was based upon a deeply flawed University of Washington study… exclud[ing] large multistate businesses with more than one location… such as McDonald’s and other fast-food chains, or Wal-Mart and other major retailers…. There were two other glaring defects…. The first is that its findings contradicted the vast majority research on minimum wages…. Second, there potentially is a problem with having a lead researcher—economist Jacob Vigdor, whose affiliations among others include the right-leaning Manhattan Institute—whose impartiality is open to question. I don’t wish to suggest people cannot have opinions, but researchers need to be open-minded….

We can’t emphasize enough just how wrong many of the initial analyses of the wage increase have been. Cognitive dissonance is a powerful force. If your ideology includes the belief that all government attempts at raising living standards are doomed, then of course you are going to be against mandated minimum wages. The problem occurs when these folks are confronted by facts that are at odds with their belief systems. The options are to either rethink your ideology or alternatively ignore the data. Most participants seem to have done the latter…

#shouldread #minimumwage #labormarket #seattle #equitablegrowth 


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