Economics: Other Economics Problems – #29381


Question: Write a short essay (three paragraphs, less than 400 words) on the market for unskilled labor and the minimum wage. Identify the main objective(s) of the policy. Explain why minimum wage laws are more important to the market for unskilled labor market than the market for skilled labor. Explain why some argue that the minimum wage increases unemployment of unskilled workers. Discuss how that unemployment effect depends on characteristics of the demand and/or supply of unskilled labor. (What sorts of real world issues might drive these important characteristics?) Discuss how the effect of the minimum wage on unemployment depends on the level of the minimum wage being discussed. Feel free to include some evidence from the real world, though this is not required. The essay is about explaining economic mechanisms. Try to be clear and succinct. The quality of your explanations counts. Do not use a graph.

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