Zeynep Ton's A Minimum Wage Essay

Zeynep Ton's A Minimum Wage Essay

Length: 909 words (2.6 double-spaced pages)

Rating: Better Essays

Open Document

Essay Preview

The article that I am studying is Zeynep Ton's A minimum wage hike could help employers, too, in the Harvard Business Review. This article is a speculative piece about the effects of proposed minimum wage increases at the federal level. The author takes a look at companies that superior wages and benefits for their industry. The underlying theme is that this is juxtaposed against a common argument that raising the minimum wage will be universally harmful.
The common argument takes beginner's level supply and demand graphs and uses them as the basis for the claim. The basic elastic supply and demand graph shows that as the cost of a good increases, demand for that good declines. Thus, if the minimum wage increases, businesses will face higher costs, will pass those costs onto consumers, will suffer lower profits or will reduce employment, or some combination of these negative outcomes. The author here is pointing out that the world is a heck of a lot more complex than that. Microeconomics does not end with the study of rudimentary supply and demand graphs, but incorporates a broader range of considerations into its arguments.
The author highlights a couple of those arguments. The first is the "good jobs strategy". The second is the efficiency concept. The two are at times related. First, microeconomic principles can be used to examine the good jobs strategy. The author cites four firms in particular – Trader Joe's, Costco, Spanish supermarket chain Mercadona and convenience store chain QuikTrip. The author acknowledges that these companies do not have too many similarities, perhaps except for the nature of the goods they sell – they are all in convenience and food retailing. This industry is characterized by a st...


... middle of paper ...


...vers. Better people won't work for minimum wage, but better people make for stronger companies. And what of customers? There are price elasticities of demand to consider in this argument. They are not relevant at Costco, and Trader Joe's is good value for its competitive niche, but many Americans are perfectly willing to pay a higher price for better quality. Yes, there are other considerations not mentioned here – the effect of minimum wage on overall inflation and things like that – but the article is a great starting point for understanding the complexity of microeconomic analysis that goes beyond the superficial analysis we often see in the media.



Works Cited


Ton, Z. (2014). A minimum wage hike could help employers, too. Harvard Business Review. Retrieved February 2, 2014 from http://blogs.hbr.org/2014/01/a-minimum-wage-hike-would-help-employers-too/

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Essay on Minimum Wage And The Wage

- Introduction Minimum wage was established state wide in 1938 by Franklin Delano Roosevelt; at that time it was only 25 cents which is equivalent to 4 dollars in today’s world. It was established as part of the Fair Labor Standards Act which covered youth, government and overtime pay. Massachusetts was actually the first state before Franklin’s statewide acknowledgement, and it only covered woman and children without overtime. There are lot of issues with minimum wage now such as setting a statewide minimum wage to $10.10, which does not benefit places were living is expensive such as in New York....   [tags: Minimum wage, Employment, Wage]

Better Essays
2449 words (7 pages)

Minimum Wage Is Not A Living Wage? Essay

- The Minimum Wage is Not a Living Wage Anymore Should we have the minimum wage rise. Nowadays, many people argue that we should increase the minimum wage because we haven’t had an increase since 2009. People who are living on the minimum wage struggle a lot raising their families. (Webster) Minimum wage means the lowest daily or monthly remuneration that employers may legally pay to workers. On the other hand living wage means the minimum amount that a worker must earn to afford his/her basic necessities, without public or private assistance (Webster)....   [tags: Minimum wage, Wage, Living wage, Poverty]

Better Essays
1295 words (3.7 pages)

The Minimum Wage Is Not A Living Wage Essay

- The Minimum Wage Is Not A Living Wage The cost of living can become very expensive and with these expenses, money is necessary. By raising the minimum wage, living expenses could be less of a financial crisis for families. A higher minimum wage would also supply families with more ease because the struggle of making ends meet would be less. This paper discusses the advantages of a higher minimum wage, why it is necessary for those who live in, or are very close to living in poverty, and the shortcomings of the current minimum wage....   [tags: Minimum wage, Living wage, Wage, Employment]

Better Essays
1535 words (4.4 pages)

Essay Living Wage And The Minimum Wage

- The living wage is more and more being called a movement because the current federal minimum wage laws does not provide enough money for an individual that works a full time job to be able to support a family. Making them feel like they should not have to raise a family in poverty. Across the United States there are efforts to provide what is called living wages for workers which began with requiring all employers to pay at least the minimum wage to its workers that is equal to the living wage for the area (City/State) they are working in....   [tags: Minimum wage, Living wage, Employment, Wage]

Better Essays
1054 words (3 pages)

Minimum Wage And The Wage Essay

- Minimum Wage, Is How Much. Minimum wage is the lowest wage someone can be paid that is permitted by law per hour (“Minimum Wage”). The Federal minimum wage was created in 1938 by President Franklin D. Roosevelt starting out at $0.25 per hour. The Federal minimum wage is now set at $7.25 which was put into effect on July 24, 2009. The minimum wage has been set at $7.25 an hour for more than seven years. Some people think that the minimum wage should stay the same and others think that it should be increased....   [tags: Wage, Minimum wage, Supply and demand]

Better Essays
1197 words (3.4 pages)

Minimum Wage And The Wage Essays

- The federal minimum wage became a law in 1938 and the first minimum wage started at .25 cents. Over the past years, the minimum wage has seriously changed because of the power of economy. In 1948 the minimum wage was starting with 3.09 to 8.67 dollars an hour, however, in 2013, the average was 6.60 dollars per hour. As the decades past, this amount of money was changing dramatically till today, which is 7.25 dollars an hour as shown in the graph below. That being said, today’s minimum wage is more than the minimum wage has historically presented, although it remains over a dollar an hour below its historical high....   [tags: Minimum wage, Employment, Wealth, Wage]

Better Essays
1164 words (3.3 pages)

Minimum Wage And The Wage Essay

- In order to keep the economy from fluctuating too far from equilibrium, the federal government sets price floors on goods and services. This tool known as a price floor initializes a minimum wage at which laborers can sell their labor to employers. Typically, the minimum wage depends on rising or falling productivity. It also reflects the inflation rates and the average income needed to reach the standard of living. Standard of living is thought to be improved with a minimum salary; making the average level of comfort and self- sufficiency easily obtainable....   [tags: Minimum wage, Wage, Employment, Unemployment]

Better Essays
1051 words (3 pages)

Essay Minimum Wage Is An Hourly Wage

- A minimum wage is an hourly wage that is established by the government which represents the minimum amount an individual receives per hour. The federal minimum wage was established in 1938 under the “Presidency of Franklin Roosevelt” (Henderson). Currently, majority of the states have their minimum wage less than $10. However, the federal government wants to increase the minimum wage to $12 across the United States. The federal government believes that increasing the minimum wage will assist numerous people in the United States as most individuals are working in a minimum wage job to support their families....   [tags: Minimum wage, Employment, Wage, Working class]

Better Essays
1247 words (3.6 pages)

Essay about Minimum Wage And The Wage

- Does getting paid $15 an hour sound good. How about getting paid that much for flipping a burger. The Government has been talking about increasing the minimum wage. It has been an increasingly controversial topic in recent years. The minimum wage is the lowest legal hourly wage a worker can get paid. That being said, waiters are paid significantly less because the government believes that their tips will make up the difference. However, most of the time tips do not make up the difference. Minimum wage is paid to people whose jobs require little or no skill....   [tags: Minimum wage, Wage, Employee benefit, Employment]

Better Essays
1047 words (3 pages)

The Minimum Wage Essay

- "The minimum wage is something that F.D.R. put in place a long time ago during the Great Depression. I don't think it worked then. It didn't solve any problems then and it hasn't solved any problems in 50 years." -- John Raese For many years it has been a matter of conventional wisdom among economists that the minimum wage causes fewer jobs to exist than would be the case without it. This is simply a matter of price theory, taught in every economics textbook, requiring no elaborate analysis to justify....   [tags: Minimum Wage Research Paper]

Better Essays
3664 words (10.5 pages)