Economics textbooks leave most students with the distinctive impression that raising the minimum wage creates a market failure and only creates unemployment because that is the simplest story you can tell using the most revered tool in economics: the supply and demand graph. Many of my students probably think that I oppose the minimum wage based on this powerful, but overly simplistic model. As I wrote a month ago, I think there are better ways to reduce inequality, but they are less politically feasible than the minimum wage, so I support raising the minimum wage. And most PhD economists agree with me.
The University Of Chicago economics department is famously conservative and free-market, and within the University of Chicago, the Booth Business School is probably the most free-market. This group sponsored a survey of elite economists that found that almost five times more economists support raising the minimum wage than lowering it.
This is unsurprising to me from my conversations with other economists. What is more interesting is that over a third of these economists either don’t know or don’t care about this question. This is probably partly because this is a poll of elite economists and many elites don’t care enough about inequality to learn about the effects of the minimum wage. Plus elite academics often get so focused upon their areas of specialty that they ignore most of the rest of what is going on in economics research outside of their own narrow field. That is one of the reasons that elite economists sometimes make stupid public mistakes.
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