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On June 23 2010 18:49 kzn wrote:Show nested quote +On June 23 2010 18:25 dogabutila wrote:This is not an accurate assumption. It does depend on how many less hours specifically and how much the wage increase is. I don't believe I ever said anything about a wage increase. There is no wage increase justified merely by lowering hours worked. The choice they are faced with, in reality, is to do a certain amount of work and get paid the amount that work is worth, or to do less work and get paid what that less work is worth (less).
On June 23 2010 16:44 kzn wrote:Show nested quote +Are you really contending that the masses of people in India and China working below minimum wage aren't good enough workers to deserve it? No, but I am contending that if you gave them a choice between working the jobs they work now and not working at all, or working less hours at a higher wage, they would choose to continue with what they're doing now.
Show nested quote +The problem with this argument is that not all jobs require the same things. Some skills are in higher demand in some fields, and some skills are necessary for others. The problem with looking at it in this flat way is the assumption that some skills will be in higher demand. Some skills MIGHT be in higher demand, but simply because there are more jobs in that field (which keeps the wage from being higher). Breaking the argument down, you have to look at the job offerings // skillsets not in one big pool, but as a bunch of little pools. So, wages rise and fall with the growth and contraction of that industry, only so long as there are not enough people to meet that need // not enough people to meet that need. It has very little to do with genetic distribution and more with what field is chosen in school // job training one has.
The point is statistics cannot give a complete picture simply BECAUSE some variables are not randomly distributed. You can't exclude information because it does not fit the model. Yes, you have to look at things are little pools rather than one massive pool, but with a world population in excess of 6 billion people, even your smallest pools are large enough that statistical analysis makes sense and can be quite accurate.
Again; not quite. because as you did mention... There are some variables that are not random
On June 23 2010 18:07 kzn wrote: It doesn't matter that IQ doesn't determine job fitness. Job fitness is determined by a vast number of variables, some of which are genetic and thus randomly distributed and some of which are not, and thus cannot adequately be described by a statistical distribution.
One might also say that since the pool is so large, it becomes impossible to control for all variables and still have a statistically significant answer.
Needless to say, even though each little pool is separate actions and events in one area or industry have an effect in others. So too for countries.
The point is that minimum wage is not bad necessarily because it gives some 'undeserving' people a wage higher then what might be market value, the true harm in a minimum wage is that it requires the people to be consumers and not producers. A minimum wage strictly hampers industry and manufacturing. When your country is so reliant on others to keep producing things for you, if they are no longer able to then you are seriously fucked.
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On June 23 2010 19:12 kzn wrote:Show nested quote +On June 23 2010 18:59 hammeronetime wrote: I looked up Switzerland's unemployment and it was 3.7% and I find that highly suspect. Leads me to believe they're not recording everything. I wonder what the employment rate is specifically for people that are aged 16-22 and whether they factor in students looking for a part-time job. Unemployment surveys (in the US at least) will only count you as unemployed if you both dont have a job and have actively been looking for a job in the last week. I believe full-time students aren't counted by default, but I'm not very sure about that.
Full time students generally are not counted.
The funny thing is (barring census stuff), 'unemployment numbers' have been dropping even though there are the same numbers of people without jobs because many of them have given up.
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On June 18 2010 14:12 ~ava wrote: In Australia:
"The federal minimum wage is currently $14.31 per hour or $543.78 per 38 hour week (before tax). Casual employees covered by the federal minimum wage also get at least a 20 per cent casual loading. "
1 USD = 0.868 AUD so minimum wage is $12.42
Wage is being updated July 1st actually, slight increase.
As of July 1st
Minimum wage for someone 20 years and above is: $14.82 (~$13US) for full or part time employment $19.52 (~$17US) for casual employment
...
16 years old is: $8.24 (~$7.20US) for full or part time employment $10.84 (~$9.50US) for casual employment
Under 16 years old: $8.07 (~$7US) for full or part time employment $10.63 (~$9.30US) for casual employment
Incremental wage increases for every year between 16 and 20
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Minimum wage in my country is around 18 dollars.
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Since some people seem to think it's a good idea to lower the minimum wage, I'll shamelessly paste what Paul Krugman has to say on the subject "Would cutting the minimum wage raise employment?" + Show Spoiler +It seems that more and more Serious People (and Fox News) are rallying around the idea that if Obama really wants to create jobs, he should cut the minimum wage.
So let me repeat a point I made a number of times back when the usual suspects were declaring that FDR prolonged the Depression by raising wages: the belief that lower wages would raise overall employment rests on a fallacy of composition. In reality, reducing wages would at best do nothing for employment; more likely it would actually be contractionary.
Here’s how the fallacy works: if some subset of the work force accepts lower wages, it can gain jobs. If workers in the widget industry take a pay cut, this will lead to lower prices of widgets relative to other things, so people will buy more widgets, hence more employment.
But if everyone takes a pay cut, that logic no longer applies. The only way a general cut in wages can increase employment is if it leads people to buy more across the board. And why should it do that?
Well, the textbook argument — illustrated in this little writeup — runs like this: lower wages lead to a lower overall price level. This increases the real money supply, and therefore liquidity. As people try to make use of their excess liquidity, interest rates go down, leading to an overall rise in demand.
Even in this case, it’s hard to see the point of cutting wages: you could achieve the same effect, much more easily, simply by having the Fed increase the money supply.
But what if we’re in a liquidity trap, with short-run interest rates at zero? Then the Fed can’t achieve anything by increasing the money supply; but by the same token, wage cuts do nothing to increase demand.*
Wait, it gets worse. A falling price level raises the real value of debt. To the extent that debtors are more likely to cut spending in such a case than creditors are to increase it — which seems likely — the effect of the wage cuts will actually be a fall in demand.
And one more thing: to the extent that people expect further declines in wages and prices, this raises real interest rates, which is even more contractionary.
So proposing wage cuts as a solution to unemployment is a totally counterproductive idea. Not that I expect any of this discussion to make any impact on those proposing it.
* Somebody is going to ask, what about the real balance effect? Doesn’t a falling price level make people wealthy, by raising the real value of the money they hold. The answer is, consider the magnitudes. Before the crisis, the monetary base — the system’s “outside money” — was around $800 billion. (It’s a much more confusing situation now, so I won’t try to parse the current numbers here). This means that even a 10 percent fall in the price level, which is very hard to achieve, would raise real wealth by only $80 billion. Compare this with the effects of the decline in housing and stock prices, which reduced household wealth by $13 trillion in 2008. The real balance effect is totally trivial.
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On June 23 2010 22:01 VegeTerran wrote:Since some people seem to think it's a good idea to lower the minimum wage, I'll shamelessly paste what Paul Krugman has to say on the subject "Would cutting the minimum wage raise employment?" + Show Spoiler +It seems that more and more Serious People (and Fox News) are rallying around the idea that if Obama really wants to create jobs, he should cut the minimum wage.
So let me repeat a point I made a number of times back when the usual suspects were declaring that FDR prolonged the Depression by raising wages: the belief that lower wages would raise overall employment rests on a fallacy of composition. In reality, reducing wages would at best do nothing for employment; more likely it would actually be contractionary.
Here’s how the fallacy works: if some subset of the work force accepts lower wages, it can gain jobs. If workers in the widget industry take a pay cut, this will lead to lower prices of widgets relative to other things, so people will buy more widgets, hence more employment.
But if everyone takes a pay cut, that logic no longer applies. The only way a general cut in wages can increase employment is if it leads people to buy more across the board. And why should it do that?
Well, the textbook argument — illustrated in this little writeup — runs like this: lower wages lead to a lower overall price level. This increases the real money supply, and therefore liquidity. As people try to make use of their excess liquidity, interest rates go down, leading to an overall rise in demand.
Even in this case, it’s hard to see the point of cutting wages: you could achieve the same effect, much more easily, simply by having the Fed increase the money supply.
But what if we’re in a liquidity trap, with short-run interest rates at zero? Then the Fed can’t achieve anything by increasing the money supply; but by the same token, wage cuts do nothing to increase demand.*
Wait, it gets worse. A falling price level raises the real value of debt. To the extent that debtors are more likely to cut spending in such a case than creditors are to increase it — which seems likely — the effect of the wage cuts will actually be a fall in demand.
And one more thing: to the extent that people expect further declines in wages and prices, this raises real interest rates, which is even more contractionary.
So proposing wage cuts as a solution to unemployment is a totally counterproductive idea. Not that I expect any of this discussion to make any impact on those proposing it.
* Somebody is going to ask, what about the real balance effect? Doesn’t a falling price level make people wealthy, by raising the real value of the money they hold. The answer is, consider the magnitudes. Before the crisis, the monetary base — the system’s “outside money” — was around $800 billion. (It’s a much more confusing situation now, so I won’t try to parse the current numbers here). This means that even a 10 percent fall in the price level, which is very hard to achieve, would raise real wealth by only $80 billion. Compare this with the effects of the decline in housing and stock prices, which reduced household wealth by $13 trillion in 2008. The real balance effect is totally trivial.
Well you can probably find some other Nobel Prize winner that doesn't agree with Krugman at all though (he is afterall a fairly "european" in his views).
But then again thats why I absolutely love macroeconomics =)
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Why would you even work for $6.50 an hour if you don't even like the job? Do you really want to wash dishes anyways if your not delivering?
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Here is a good write-up on the ridiculousness of raising minimum wage: http://cafehayek.com/2010/04/an-entrepreneur-and-the-minimum-wage.html
Maybe it really is different in Australia or Denmark, but in the United States many businesses rely on cheap (not the best word) labor or they don't exist. If minimum wage does rise too high, the owners will eat the rise in expense to a point, but what will happen next is hours will get reduced, people will get fired, or the owner will just start paying people under the table making the rise in minimum wage pointless.
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On June 24 2010 03:15 hammeronetime wrote:Here is a good write-up on the ridiculousness of raising minimum wage: http://cafehayek.com/2010/04/an-entrepreneur-and-the-minimum-wage.htmlMaybe it really is different in Australia or Denmark, but in the United States many businesses rely on cheap (not the best word) labor or they don't exist. If minimum wage does rise too high, the owners will eat the rise in expense to a point, but what will happen next is hours will get reduced, people will get fired, or the owner will just start paying people under the table making the rise in minimum wage pointless.
Ya because the owner is a greedy SOB who wont take a slight cut in their pay. This whole discussion can be summed up as people who are well off will absolutely not take even the slightest cut in their pay. Instead they will pass the costs on to someone else.
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Minimum wage law is just a restriction. It doesn't say an employer has to hire someone for a higher wage, it just says the employer cannot hire someone below the rate. At the very least, those employees who aren't valued higher than the minimum, are never going to be employed (legally).
In fact, it might drive those "illegal workers" wages down further, because the employer is burdened with a legal liability, and therefore have to either pay less or get more from them to account for that additional risk of fines and/or imprisonment.
Sure you can say that someone who would be borderline below the minimum rate can benefit from the little stick they have, and get a higher wage without working any harder, but even then, you've got to understand that in the market, everything comes from somewhere. That extra money given to the minimum wage worker is taken from the consumer... in the form of higher prices.
I see Krugman's argument as a non-sequitur... people against a minimum wage aren't necessarily for wage cuts, so every consequence thereof is irrelevant. I'm not for anything but against restrictions on people's wallets. I'm not one to tell what should or should not other people do with their money, and I disrespect any macro-economist who believes he can make the world a better place by restricting people's economical choices.
For all I care, it could be the case that when the minimum wage is abolished, wages could go higher, as the employers aren't burdened with as many bureaucratic forms and procedures, and can either cut prices or raise wages with their liberated resources. Who knows. Point is, regulations can't build anything, they can only inhibit...
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I believe minimum wage in California for people being tipped is something around ~$2.20, give or take twenty cents. That's what they pay at anywhere classy such as the Ritz Carlton. Because you make $30 in tips on a single table!
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On June 24 2010 03:55 Sadist wrote:Show nested quote +On June 24 2010 03:15 hammeronetime wrote:Here is a good write-up on the ridiculousness of raising minimum wage: http://cafehayek.com/2010/04/an-entrepreneur-and-the-minimum-wage.htmlMaybe it really is different in Australia or Denmark, but in the United States many businesses rely on cheap (not the best word) labor or they don't exist. If minimum wage does rise too high, the owners will eat the rise in expense to a point, but what will happen next is hours will get reduced, people will get fired, or the owner will just start paying people under the table making the rise in minimum wage pointless. Ya because the owner is a greedy SOB who wont take a slight cut in their pay. This whole discussion can be summed up as people who are well off will absolutely not take even the slightest cut in their pay. Instead they will pass the costs on to someone else.
He is greedy because he won't take a cut in pay? How do you know he hasn't? How much do you think he makes? Not everyone who owns a business is making 6 figures, drives a sports car, and lives in a mansion. Owners are usually the first person to take a pay cut, and then they start scaling back operations - cutting labor costs.
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Wow that's really low. Used to work as a cashier in a supermarket here in Norway, it's like the shittiest job you can get apart from cleaning toilets, and i made 20,2 dollars an hour when i convert it. Making slitghly less then that atm(19,5) working in a sports store but its a way way better working environment and job in general so dont really mind.
But damn thats low.
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This is how the other half lives.
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On June 24 2010 08:15 unkkz wrote: Wow that's really low. Used to work as a cashier in a supermarket here in Norway, it's like the shittiest job you can get apart from cleaning toilets, and i made 20,2 dollars an hour when i convert it. Making slitghly less then that atm(19,5) working in a sports store but its a way way better working environment and job in general so dont really mind.
But damn thats low.
But how much of your pay disappears in taxes compared to ours...
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don't worry about 6.50 being low.
the FED is making sure all your dollars are worth less and less every second.
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On June 24 2010 15:18 FabledIntegral wrote:Show nested quote +On June 24 2010 08:15 unkkz wrote: Wow that's really low. Used to work as a cashier in a supermarket here in Norway, it's like the shittiest job you can get apart from cleaning toilets, and i made 20,2 dollars an hour when i convert it. Making slitghly less then that atm(19,5) working in a sports store but its a way way better working environment and job in general so dont really mind.
But damn thats low. But how much of your pay disappears in taxes compared to ours...
About half of it, over the entire economy.
Probably less for lower earners.
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On June 24 2010 15:50 kzn wrote:Show nested quote +On June 24 2010 15:18 FabledIntegral wrote:On June 24 2010 08:15 unkkz wrote: Wow that's really low. Used to work as a cashier in a supermarket here in Norway, it's like the shittiest job you can get apart from cleaning toilets, and i made 20,2 dollars an hour when i convert it. Making slitghly less then that atm(19,5) working in a sports store but its a way way better working environment and job in general so dont really mind.
But damn thats low. But how much of your pay disappears in taxes compared to ours... About half of it, over the entire economy. Probably less for lower earners.
and how much free shit does the norwegian government give you
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You don't pay 50% taxes in norway, if you're a swede working in norway you normally end up paying 20-25% in taxes. Norweigans pay around 35% in taxes.
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On June 24 2010 18:32 Escoffier wrote:and how much free shit does the norwegian government give you
Less shit than you'd get if you were able to spend all of that money yourself.
You don't pay 50% taxes in norway, if you're a swede working in norway you normally end up paying 20-25% in taxes. Norweigans pay around 35% in taxes.
You have close to 50% of your GDP generated by government activity. No matter how you argue it, there are only two ways this is possible:
1. Your government is borrowing ridiculous sums of money every year (which isn't happening in Norway, afaik).
2. Taxes take in roughly half of all income earned by that economy.
You might not be paying 50% income taxes, but half of your income is going to the government somehow.
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