Minimum wage warps the equilibrium point

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Reference no: EM13769414

It is generally accepted among economists that minimum wage warps the equilibrium point between the supply and demand of labor by instituting price floor and increases unemployment for unskilled laborers (while increasing the wage for the individuals who continue to work).

However, I have noticed that politicians continue to advocate an increase in the minimum wage. Politics and political manoeuvring aside, is there an economic reason as to why a higher minimum wage would benefit the economy?

Reference no: EM13769414

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