Minimum
wages
from » the
Economist »,
Many countries set minimum wages, with the intention of protecting the living standards of
workers in low-paid jobs. But it is
misguided for governments to try to
protect the poor by forcing up wages.
Minimum wages eliminate the jobs of too
many of those who are supposed to be helped.
Why ? Suppose that legislation fixes a minimum wage of W1. Firms
are willing to hire more workers at a wage below
the minimum and there are workers willing to accept lower wages. But the law stops wages from falling and so prevents the creation of new jobs.
Minimum wages are especially likely to damage the job prospects of the
young, who start out in low-wage jobs. In
After reading this text
carefully ( you may print it), do the following exercises : WRITE your answers , print the sheet and hand in
your work to your teacher on Friday