I know there are problems with the market, and it fails in all kinds of interesting ways, but I tend to want some sort of reason to believe that it's failing. Yeah, I assume that people try to act in their own self-interest, that they try to figure out what works, and the ones who consistently fail will over time be outnumbered by those who succeed.
Efficiency wages are part of the standard first-year economics class in business school, and I could argue that business has been aware of their practical manifestation at least since Henry Ford started paying his guys five dollars a day, well before theoretical justification. Even if they don't know why they're paying these wages, the ones who don't are getting eaten alive by turnover costs.
I'll pick up the $20 if I happen to spot it, but I don't spend a lot of time looking for $20s on the ground, because I need some sort of reason to expect them to be there.
(One of these days I'm going to write my essay about how socialism is like Intelligent Design, in the shared lack of belief that anything sensible can arise from a purposeless system of ignorant units.)
Oh, and that article is so terrible. Yikes. OK, so the Washington minimum wage has forced Idaho businesses near the border to also pay above-equilibrium wages. And both economies are succeeding despite the unnaturally high wage. Oh, and they admit that Idaho has higher job growth than Washington (not really evidence of anything, but it's weird that they admit that if they're trying to argue that minimum wages don't kill jobs.)
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Efficiency wages are part of the standard first-year economics class in business school, and I could argue that business has been aware of their practical manifestation at least since Henry Ford started paying his guys five dollars a day, well before theoretical justification. Even if they don't know why they're paying these wages, the ones who don't are getting eaten alive by turnover costs.
I'll pick up the $20 if I happen to spot it, but I don't spend a lot of time looking for $20s on the ground, because I need some sort of reason to expect them to be there.
(One of these days I'm going to write my essay about how socialism is like Intelligent Design, in the shared lack of belief that anything sensible can arise from a purposeless system of ignorant units.)
Oh, and that article is so terrible. Yikes. OK, so the Washington minimum wage has forced Idaho businesses near the border to also pay above-equilibrium wages. And both economies are succeeding despite the unnaturally high wage. Oh, and they admit that Idaho has higher job growth than Washington (not really evidence of anything, but it's weird that they admit that if they're trying to argue that minimum wages don't kill jobs.)