Wage Increase
Difference Between Substitution Effect and Income Effect
Substitution Effect
The substitution effect states that workers are encouraged to work more when the wages increase. This is because they get more money by working for longer hours and this motivates them to put in more time and effort. This means there is a positive relationship between wage increase and the effort put in by workers. When one increases, the other increases too. Also, the amount of leisure time available for workers goes down because they spend more hours in a day at work. This results in an upward sloping labor supply curve that moves towards the northeast because workers are willing to put in more hours to take advantage of the wage increase.
Income Effect
The income effect of a wage increase means the worker gets more money for the same effort. This means, the worker can enjoy a higher standard of living and…...
mlaReferences
McEachern, William. (2010). Microeconomics: A Contemporary Introduction. Boston: Cengage Learning.
Abstract/ Introduction
Minimum wage increases have not kept pace with real wages, according to testimony given before the U.S. Senate Committee on Health, Education, Labor and Pensions (Dube, 2013). As a result of what amounts to a declining minimum wage, there is rising inequality mainly in the bottom tier of the pay distribution. Some believe that raising the minimum wage would help to close the gap and reduce inequality. Others argue that raising the minimum wage would only worsen the economic conditions that prevail today, drive employers to lay off workers or offshore more jobs, and drive the prices of goods up for consumers as the cost of labor is passed on to the customer. This paper will examine the impact of increasing minimum wage rates and what effect it would have on employers and employees, the local economy, the global economy and on consumers.
Effects on the Employers and Employees Due…...
mlaReferences
Dube, A. (2013). Statement before the Committtee. Retrieved from Economic Policy Institute. (2018). Economists in support of a federal minimum wage of $15 by 2024. Retrieved from https://www.epi.org/economists-in-support-of-15-by-2024/Employment Policies Institute. (2007). Majority of Labor Economists Believe Minimum Wage Hikes Cause Unemployment. Retrieved fromhttps://www.epionline.org/release/majority-of-labor-economists-believe-minimum-wage-hikes-cause-unemployment/Filion, K. (2009). Increases in minimum wage boost consumer spending. Retrieved from https://www.epi.org/publication/snapshot_20090527/Sunde, J. (2018). Study: How minimum wage increases hurt consumers and the poor. Retrieved from https://blog.acton.org/archives/99873-study-how-the-minimum-wage-hurts-consumers-and-the-poor.htmlhttps://www.help.senate.gov/imo/media/doc/Dube1.pdf
Wage Issues and Economic Supplements
The interview for this assignment was conducted with the human resources manager of Ford Motor Company. The company has prolonged its partnership with the United Automobile Workers union. The interview questions and their answers are listed below.
How do you rate the wage level in your company in relation to the minim wage?
Ford Motor is a company that attributes its success on the quality of its manufactured vehicles. These high quality standards can only be achieved with the quality input of our workers. Therefore, their performance becomes connected with their job satisfaction, which relies on the wages they receive for their work. We want high quality work, and we pay higher than average wages.
Q2: Are there any types of jobs within your company where you pay minimum wages?
A2: There most certainly are. We have positions where unskilled workers are required. For such positions, like cleaning positions, or…...
mlaReference list:
1. Masterfano, M. (2013). Unions: The Good, the Bad, the Ugly. The Huffington Post. Retrieved October 6, 2013 from http://www.huffingtonpost.com/michele-masterfano/unions-the-good-the-bad-t_b_3880878.html .
2. Budd, J. (2012). Union Bargaining. Retrieved October 7, 2013 from http://answers.mheducation.com/business/management/labor-relations/union-bargaining.
3. Budd, J.W. (2012). Labor Unions: Good or Bad? Retrieved October 7, 2013 from http://answers.mheducation.com/business/management/labor-relations/labor-unions-good-or-bad.
Wage and Benefit Determination
Individuals supply labor to the market at a price called the wage rate of labor. How much labor an individual supplies is related to his level of non-labor income, and cost benefits determination of time spent at leisure, vs. work.
A union can raise the wages of those who continue to be employed in a competitive labor market at the expense of the level of employment. So if the competitive equilibrium is at E0 and the wage is w0 employment is q0. If a union enters this market and sets a wage of W1, a new equilibrium will be established, e1. The supply curve has become w1xs0. At the new wage, W1, there will be q1q2 workers who would like to work but whom the industry will not hire. Employment will be q1. The decrease in employment due to wage increase is q1q2
Minimum wage is the lowest wage…...
Essay Topic Examples
1. The Impact of Minimum Wage Increases on the Hospitality Industry:
This essay could explore how raising the minimum wage affects the hospitality sector, focusing on aspects such as employment rates, pricing strategies, service quality, and business profitability. It might also discuss the potential trade-offs between higher wages and job automation.
2. Tipping Culture and Its Effects on Wage Equity in Hospitality:
This topic allows for an examination of how reliance on tips rather than base wages influences the income stability of hospitality workers. The essay could consider the disparities between front-of-house and back-of-house staff, and the move towards no-tipping policies in some establishments.
3. Wage Disparities and Gender in the Hospitality Industry:
An essay under this topic would discuss the wage gaps that exist between male and female employees in the hospitality industry. It could explore the reasons behind these disparities, such as occupational segregation, differences in hours worked, and the representation…...
mlaPrimary Sources
Bureau of Labor Statistics, U.S. Department of Labor. \"Occupational Employment and Wage Statistics: Food Services and Drinking Places.\" May 2021.
National Restaurant Association. \"2021 State of the Restaurant Industry.\" National Restaurant Association, 2021.Cornell University School of Hotel Administration. \"Compensation and Salary Studies for the Hospitality Industry.\" The Center for Hospitality Research, 2019.International Labour Organization. \"Wages in the Hospitality Sector: A Comparison of Minimum Wages.\" ILO Sectoral Policies Department, 2020.American Hotel & Lodging Association. \"AHLA\'s 2020 State of the Hotel Industry Report.\" American Hotel & Lodging Association, 2020.
The employer, according to the rules laid out by the IMSS, is expected to contribute at least a minimum amount according to the risk factors involved in the job into the fund, that is, a sum of 17.42% of each worker's wage. Basic health care, medical facilities, accident care, as well as care for illnesses are all taken care of under the social security fund. In addition, the employer is expected to pay about 5% of a fixed payroll tax into a fund that will help the employee find a home of his own easily. This fund is known as the 'National Fund for Employee Housing' or INFONAVIT. "The goal of this federal program is to provide benefits allowing employees to more easily acquire a home"
2% or 25 times the minimum wage, of a worker's salary must also be paid into the SA or the etirement Savings System under which…...
mlaReferences
Abbot, Cheryl. "Employer Costs for Employee Compensation South Region: March 2004." United States Department of Labor. Retrieved at Accessed on 2 December, 2004http://www.bls.gov/ro6/ro6ecec.htm .
Common Law Definition of an Employee." (2001) Retrieved at Accessed on 2 December, 2004http://www.hrtools.com/pops/P99_05_0120_01.asp.
Definition of Employee." Lectric Law Library's Lexicon. Retrieved at Accessed on 2 December, 2004http://www.lectlaw.com/def/e009.htm .
Employee Benefit Research Institute: 2003 Findings." Retrieved at
The film demonstrates the challenges that lower and working class parents have to face as they try to raise children on salaries barely big enough to pay basic living expenses. Mary almost found herself unable to afford a roof over her and her children's heads.
Gender is treated with due realism in Waging a Living, which does illustrate the special struggles that women face. Being a single mother is a major issue correlated with poverty. Women face challenges not only when they are single mothers, though. Access to promotions and positions of power is systematically more difficult to acquire for women, who still earn less than their male counterparts. Gender bias is built into the system.
Among the possible policy changes that could reduce income disparity and reduce the numbers of working poor in the United States, one main one suggested in Waging a Living is providing universal access to medical…...
raising minimum wage relates supply demand analysis. • If raise minimum wage businesses compensate raise workers? • According United States Department Labor, Minnesota's current minimum wage large employer's small employer's hour? • How hard working people expect ahead minimum wage low? • Due cost living minimum wage increase? This a comprehensive paper a minimum library resources.
aising the minimum wage: Supply and demand analysis
Although there is a great deal of disagreement about how to regulate the minimum wage in America, statistics indicate that the minimum wage has not been keeping pace with inflation. "The federal minimum wage is just $7.25 an hour and hasn't been raised in three years. But a raise is much more overdue than that. If we look at the minimum wage 44 years ago, and simply adjust it for inflation, it would be more than $10 today" (Weisbrot 2012). However, there is tremendous resistance to raising…...
mlaReferences
Cahill, Ben. (2012). The effect of the minimum wage on getting a foot-long Subway.
Tutor2U. Retrieved: http://www.tutor2u.net/blog/index.php/economics/comments/the-effect-of-the-minimum-wage-and-getting-a-foot-long-subway
Characteristics of minimum wage workers. (2012). Bureau of Labor and Statistics. Retrieved:
Human Resources Management: How to Improve Minimum Wage Policy Management in Hong Kong
The objective of this research is to analyze the advantages and disadvantages of minimum wage legislation in Hong Kong. When hike minimum wage can help lower skilled worker. This study will conduct an evaluation of the minimum wage hiking and how it can help the lower skilled workers and will additionally compare benchmarking minimum wage legislation with other countries, for example the standard of minimum wage.
Following minimum wage legislation the primary problems that employers and employees faced included for employers the turnover rate of lower-wage workers and how to reduce the cost of training that affects the quality of service and the working attitude and behavior of employee lack of enthusiasm. For employees problems included the increase in the unemployment rate and reduction in fringe benefits including such as medical insurance. Included in this study will be the…...
mlaBibliography
Blundell, R., and H. Reed, 2000. The Employment Effects of the Working Families Tax Credit. Institute for Fiscal Studies Briefing Note No. 6, April.
Advisory, Conciliation and Arbitration Service, 2000. Annual Report 1999 -- 2000.October.
Bartlett, B., 2000. The Verdict on the Minimum Wage: Guilty on All Counts. Economic Affairs. September.
Bartwell, R., 2000. Age Structure and the UK Unemployment Rate. Bank of England Working Paper 124.
Minimum age
Even though minimum wage has been around for many years, and was established to make sure that working people could survive and pay their bills, there are still many problems with it. This paper address both the pros and cons to raising the minimum wage, discussing not only how people can be helped by the increase in pay, but also how they are ultimately hurt by it to a larger degree. Organized labor usually fights to raise the minimum wage, but every time it goes up, prices follow, until those that make minimum wage end up worse off than they were before their wage increase.
Some states also have minimum wage laws, and often the state minimum wage is higher than federal minimum wage. hen the federal minimum wage is raised, states are at a loss with whether to raise theirs or not, and sometimes employers go out of business…...
mlaWorks Cited
Brown, C. (1988). Minimum wage laws: Are they overrated? Journal of Economic Perspectives 2:133-47.
Burkhauser, R.V., Couch, K.A. And Wittenburg, D.C. (1996). Who gets what from minimum wage hikes: A replication and re-estimation of Card and Krueger. Industrial and Labor Review 49:547-52.
Deere, D., Murphy, K.M., and Welch, F. (2004). Sense and nonsense on the minimum wage. Regulation: The Cato Review of Business and Government. [Table].
Minimum Wage. (2004). The Columbia Encyclopedia, Sixth Edition.
Minimum Wage
Why the minimum wage should not be abolished in the United States.
There are diverse issues that have been debated by politicians and critics concerning the minimum wage in the United States. Some say that the minimum wage causes an increase in the unemployment rate. In turn, it causes negative effects on the nation's economy. However, the truth on this proposition is still to be proven yet. Taking the side that the minimum wage should not be abolished in the United States, I have the following arguments to present. Most of these are obtained from debates that have been conducted concerning minimum wage, as well as from available articles providing reasons why minimum wage must stay.
Much of the arguments saying that minimum wage must be abolished argue that it causes a high unemployment rate. There are a number of studies, however, that present evidences that a minimum wage does not…...
mlaBibliography
Alexopoulus, Zach. Minimum Wages: Helpful Not Harmful.
2004. Vibewire.Net. 31 July 2004. http://www.vibewire.net/articles.php?id=2642
Hornberger, Jacod. The Minimum Wage: Enemy of the Poor.
The Future of Freedom Foundation. 31 July 2004. http://www.fff.org/comment/ed1298a.asp
Many of these jobs are therefore filled with illegal immigrants, who are more than willing to work for the low wage of the current minimum wage because it is still better than what they would be paid in their home country.
Now, if the reason for the need for minimum wage workers is because these jobs do not pay enough, it would be reasonable to argue that by increasing the pay of these positions there will be more of an incentive for legal citizens and/or residents to take the jobs. Although most people are not willing to work for the current minimum wage, many will be willing to work for the $7.25 proposed rate. This will fill the vacancy of minimum wage jobs that have been hired out to illegal immigrants. If these jobs are filled by legal workers, then there will be less work opportunities for illegal immigrants. If…...
A minimum wage also gives businesses incentives to use fewer employees and to look for less expensive labor substitutes such as automation through technology. and, the minimum wage can force many small companies who operate on thin profit margins out of business.
Thus, the minimum wage, an artificial wage subsidy for unskilled workers, means job losses. This is a commonly accepted view by most economic experts. According to a 1978 article in American Economic Review, 90% of the economists surveyed agreed that the minimum wage increases unemployment among low-skilled workers (Kearl, J.R., et al. (1979). During troubling economic times like today, it's better to have workers employed at the rate the market will bear than not at all.
orks Cited
Kearl, J.R., et al. (1979). A confusion of economists? American Economic Review 69: 28-37.
Should the minimum wage be abolished (i.e. reduced to $0.00)? BalancedPolitics.org. http://www.balancedpolitics.org/minimum_wage.htm...
mlaWorks Cited
Kearl, J.R., et al. (1979). A confusion of economists? American Economic Review 69: 28-37.
Should the minimum wage be abolished (i.e. reduced to $0.00)? BalancedPolitics.org. http://www.balancedpolitics.org/minimum_wage.htm
Compensation has become a very contentious issue within the developed world of late. Economies are continuing to struggle. The EU has created a form of quantitative easing designed to restore wage growth and stimulate the economy. China is slowing as it transitions into a consumer driven economy as oppose to an export driven economy. Brazil is struggling with massive inflation and unemployment resulting in a recession for the country. America continues to grow but only at a 2% rate. This is well below the 3% GDP growth that many economist and experts are expecting. The world is lagging behind its historical trends of growth and development. As a result, compensation growth will naturally lag. Issues abound about how to properly stimulate compensation and wage growth throughout the world. The issue is particularly important for America, with 70% of GDP resulting from consumption of goods and services. This consumption will not…...
mlaReferences
1) Card, D., & Krueger, A. B. (1995). Myth and measurement: The new economics of the minimum wage. Princeton: Princeton University Press.
2) Judge, Timothy A., Department of Management, Warrington College of Business, University of Florida, FL, U.S.. Cable, Daniel M., Department of Organisational Behaviour, London Business School, London, England
3) Figueroa, J.B. and Shaheed, Z. (Eds.) (1995). New Approaches to Poverty Analysis II: Reducing poverty through labor market policies.International Institute for Labor Studies, International Labor Organization, Geneva
The company can also allow a position to go unfilled for a time to increase its leverage; the unskilled worker would starve trying to stall for a higher wage. This again invalidates the argument that the free market can set wages effectively -- it cannot given the imbalance of bargaining power between workers and businesses. The minimum wage serves a specific economic role of balancing the bargaining power between workers and businesses.
One must also take into consideration the effect that the minimum wage has on the overall economy, and what would change if the minimum wage was abolished. By providing workers with a guaranteed living wage, the minimum wage ensures that they are able to purchase goods and services. Without a living wage, they would not purchase to the same level. If the minimum wage was abolished, companies would not lower the prices to reflect lower costs; rather, they…...
mlaReferences
Greene, B. (2013). What if there were no minimum wage? CNN. Retrieved March 5, 2013 from http://edition.cnn.com/2013/02/24/opinion/greene-minimum-wage
Romer, C. (2013). The business of the minimum wage. New York Times. Retrieved March 5, 2013 from http://www.nytimes.com/2013/03/03/business/the-minimum-wage-employment-and-income-distribution.html?pagewanted=all
1) Many studies have shown that minimum wage increases have a positive impact on reducing poverty rates. By ensuring that workers earn a wage that covers their basic needs, minimum wage laws help lift low-income individuals and families out of poverty.
2) Minimum wage laws can also stimulate economic growth. When low-wage workers have more money to spend, they are more likely to consume goods and services. This increased consumer spending can boost demand, leading to job creation and supporting local businesses.
3) Implementing a minimum wage can also improve public health outcomes. Research has found that higher wages are associated with....
1. The importance of voting in local and national elections
2. Why recycling and reducing waste is crucial for the environment
3. The benefits of volunteering in your community
4. The negative effects of social media on mental health
5. The need for stricter gun control laws in the United States
6. The importance of implementing a minimum wage increase
7. Why animal testing should be banned
8. The benefits of practicing mindfulness and meditation
9. The necessity of providing free healthcare for all citizens
10. The importance of taking action against climate change.
11. The impact of fast fashion on the environment and why consumers....
Toulmin Argument
Toulmin's model of argumentation offers a structured framework for constructing and evaluating arguments. It consists of six elements:
Claim: The proposition being argued.
Data: The evidence supporting the claim.
Warrant: The reasoning that connects the data to the claim.
Backing: The evidence supporting the warrant.
Qualifier: A term expressing the level of certainty or probability assigned to the claim.
Rebuttal: A statement acknowledging and addressing counterarguments.
Selecting Essay Topics
To select essay topics that cover Toulmin argument, focus on topics that require you to:
State a clear claim: Identify a proposition that you can support with evidence.
Gather and analyze data:....
1. The Impact of Social Media on Mental Health: Should stricter regulations be imposed?
2. The Death Penalty: Is it an effective deterrent or a violation of human rights?
3. The Relationship between Climate Change and Human Activities: Is there enough evidence to support the link?
4. Universal Healthcare: Is it a viable solution to the healthcare crisis?
5. The Role of Technology in Education: Does it enhance or hinder the learning experience?
6. Animal Testing: Is it justifiable for the advancement of medical research?
7. The Use of Performance Enhancing Drugs in Sports: Should they be allowed or banned?
8. Gun Control: Striking a balance between....
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