Wednesday, January 22, 2014

The nonsense of the minimum wage studies

Economists in DC want to change the law to effect poverty in Fresno, CA. Is that possible?

Well, poverty varies from 11% to 15% over the business cycle. Poverty varies about 6% on a regional basis. Weather alone accounts for most of the regional variation. What is the likelihood that some economist has managed to detrend all this variation and then come up with an elasticity of poverty vs minimum wage? I know none of them even have a clue about the determinants of poverty, most, like Dylan Matthews, simply resort to fiction.

Ignore the minimum wage studies, they are mostly just fiction by self important economists. We do not need to go far to determine the main component of poverty in Fresno, it is over aggregation in DC. The mental illness of being a so called representative in a region of the USA with the least amount of democracy in North America. 

Under that kind of under-representation, Fresno has no choice but to generally break federal law.

No comments: