Yesterday we said,
The redistribution of income and employment caused by a big jump in the minimum wage are beyond MWG skills to model but our analysis comes down to we don’t want to order food from an iPad.
Ask and ye shall receive. The CBO is on the case, excuse me, the nonpartisan CBO is on the case:
Effects of the $10.10 Option on Employment and
Income. Once fully implemented in the second half of
2016, the $10.10 option would reduce total employment
by about 500,000 workers, or 0.3 percent,
It is not a dominate solution because many people benefit and some of them are poor. The net expectation is that 900,000 will get out of poverty and 500,000 will be out of a job. It seems to us that this is a terrible trade-off but utility functions vary. The amount that would go annually to families below the poverty level? $5 billion. Raising the minimum wage does hurt the rich, minus $17 billion, so people might support it as a pure envy play.