Econ 201- 25
17 May 2012
Microeconomics Research Paper
In the United States, minimum wage has remained at a low number for several years. Minimum wage is defined as the lowest possible income that an employer can legally pay an employee. This ensures that all people are fairly paid and not defrauded by companies or businesses. Minimum wage is considered a price floor and the minimum wage laws determine the lowest price possible that any employer must pay for labor. In an economic model, the quantity of supplied is greater than the quantity demanded and the minimum wage is above equilibrium price and quantity. Minimum wage prevents labor supplied and labor demanded from moving toward equilibrium price and quantity. Although the government is trying to maintain a good balance of income distribution, there are is a high amount of people that work year round and still fall under the national poverty level. The government tries to stop the rich from getting richer, and the poor from getting poorer, so they make sure that everyone is earning the same amount of money. Even if our balanced income distribution is at a good number, an increase of the minimum wage price would help our country in a lot of ways. Raising the current minimum wage is one way to reduce poverty, will help businesses grow, and could help a lot of communities as well.
The first advantage of increasing the minimum wage is that it will help poor people to earn a higher income. For many workers, minimum wage is simply not enough money for them to be able to support their families. A higher minimum wage would guarantee a higher quality of life for the people who work in basic jobs such as cleaning and preparing fast food. These workers' economic situations are usually a result of their lack of education and training, and it is often difficult for them to get more education or training because of their economic situation. For many working...