http://ideas.repec.org/p/nbr/nberwo/4509.html << The seminal CKK dissenting opinion that caused the whole debate in the first place, which found that unemployment went down in the short term after an increase in the minimum wage. Has since been destroyed under the weight of later work
http://ideas.repec.org/p/cep/cepdps/0497.html << A major work that found a significant negative causative effect on both youth employment and aggregate state employment in the long term resulting from a minimum wage hike. Also spent a significant amount of time taking apart the CKK study and exposing the reasons it got the results it did.
These are the most significant serious economic studies related to the minimum wage. Feel free to peruse the lengthy reference sections to find further studies, all concluding that the minimum wage has serious negative effects on prosperity, social mobility, and employment more generally.
There, now we can get back to discussing more interesting things.
Lowers social mobility, creating a more stratified society.
Increases unemployment both directly and indirectly.
Makes possible racial and social discrimination by employers.
Reduces the GDP of regions that adopt it.
I don’t think I can be any more clear in stating that the minimum wage helps absolutely nobody. Supporting it is like refusing to accept evidence of global warming.
Wikipedia says the evidence is completely unconclusive and that surveys have shown more and more economists supporting a minimum wage. I don’t think the picture is as you paint in Aeon.
Hardly. Economists aren’t real scientists. Call me back when economics has strong predictive and explanatory powers (that don’t involve shuffling assumptions around until the facts happen to fit the model).
When I can get a degree in economic engineering I’ll take economists a lot more seriously.
Short term study equivalent to CKK, examines results from changes to minimum wage two and four years prior to research. As all studies have show, the short term effects are minimal and often positive. Long term effects are universally negative. Doesn’t actually link to the study itself btw.
Again, short term. But, hilariously, guess what’s popping up?
Guess what that means?
Wikipedia says the evidence is completely unconclusive and that surveys have shown more and more economists supporting a minimum wage. I don’t think the picture is as you paint in Aeon.
Wikipedia? Lol. Yes, I’m fully willing to accept the opinion of Wikipedia over innumerable sourced, long term studies. That makes sense.
edit: Just to be clear, every study you cited looked at data over the period 1999 to 2003. The CKK study showed the same effect seen in all three of your cited studies looking at data from 1992 to 1994. As a single counter example, the Canadian time series study I cited above looked at data from multiple Canadian states with different minimum wages from 1975 to 1993. You see the difference? Over the short term, there’s no real effect from the minimum wage. The longer things go on, the more pernicious the effect.
I’m sorry, what? Outside of pure mathematics, you’re almost never going to ever be able to prove something.
Economists develop a model and then test it by taking the best data available and running it through the best statistical tools available, much like any scientific study. The only major difference is the lack of a laboratory setting for macro-economic analysis – much micro-economic analysis can and does take place in laboratory settings.
Now, if you want to argue about the predictive value of models in future time periods, I’m not the guy you want as I agree that you can’t take economic data, which is generally a quarter or more old, and use it to create predictions for future time periods. It’s stupid.
But when it comes to telling you what will most likely happen when you initiate a particular policy, economists are as good as clinical psychologists or climatologists – complex systems are hard to analyze, be they brains, economies, or global weather patterns.
And if you can’t get to grips with economics as a social science, you’re frankly a loon who isn’t worth conversing with.
All the hard sciences have predictive power. We know the world works likes this, so if you do X then Y will happen. The social sciences do not. I’m not trying to say the social sciences are worthless, but they are definitely way less useful than the hard sciences in terms of setting policy. If a scientist tells you that your nuclear reactor design will result in a catastrophe, you stop and take a step back. If an economist tells you that your policy might not be economically optimal you take that under advisement but it isn’t a huge red flag that you are doomed.
The problem with that approach is that its nearly impossible to differentiate between good findings and statistical wankery. Anyone can make any theory or model fit any facts with enough assumption twiddling.
Um, no. I’d agree on psychologists (and they make GREAT policy recommendations) but the climatologists are real scientists.
Exactly, economics is a social science and not a real one. Thank you. That was my point.
Scientists don’t prove things either. They collect evidence & test hypotheses in an attempt to get closer to the truth. The fact that you don’t know this would strongly suggest that you’re not a real scientist. Which leads me to…
Economists develop a model and then test it by taking the best data available and running it through the best statistical tools available, much like any scientific study. The only major difference is the lack of a laboratory setting for macro-economic analysis – much micro-economic analysis can and does take place in laboratory settings.
That “only major difference” is precisely the difference between you & a real scientist. Scientists create hypothesis, design experiments to test them, and then gather data based on those hypotheses. Macro-economists (which are the only kind that most people care about, to be honest) simply can’t do that; they don’t have the freedom to fuck with the economy to “see what happens”. They can observe what has happened when policy-makers have fucked around with it, but even then they don’t have the luxury of controlling the variables to create a true experiment, in the scientific sense.
This is not to say that economists are worthless or have nothing to say. But it does mean that economics does not, and cannot, have the rigor that the sciences do. Economics is by its very nature quite a bit less precise than the sciences, which themselves are imprecise endeavors, despite our best efforts.
And if you can’t get to grips with economics as a social science, you’re frankly a loon who isn’t worth conversing with.
You would have better luck with this whole discussion thing if you tried to understand what other people are saying before you start insulting them. Frankly.
Edit - Damnit. Beaten by Kraaze. At least we said different things.
Neither do climatologists, nor evolutionary biologists, nor astronomers, geologists, etc. Your real scientist/fake scientist dichotomy is a bit suspect.
As James says, only a limited number of disciplines that we consider scientific have the ability to robustly test theories on the relevant scale.
Yes, it’s great that mathematicians can construct relatively pure proofs, and it’s nice that chemists can prove a lot of stuff in a lab. But that doesn’t invalidate the decades and/or centuries of theory, analysis, and yes, even testing, behind many of the social sciences (including economics), and even, whoa - can ya’ believe it - many ‘hard science’ areas such as the ones James lists.
Are you all so quick to reject human-caused global warming because current predictions are the results of models and we can’t, you know, set up a parallel Earth to run century-long experiments and really pin things down?
You are conflating complex systems with different attributes. In climatology, the more one simplifies the system to just look at one factor, the easier it gets to understand and predict. There may be a lot of variables interacting but it is possible to understand the individual behavior of the variables. To use the global warming example, we know that some gasses trap more sunlight than others, etc.
If you reduce any complex model from the social sciences down to down to the individual factor, a single human being, they have no predictive ability at all. Things get murkier as you go into finer and finer focus, not clearer as in the real sciences.
First, they make predictions about how the system will behave under certain circumstances, and gather data to test their predictions. The natural world is much more cyclical than human economics, so if you make a prediction about a behavior of hurricanes, you can rest assured that you will have future hurricanes on which you can test your hypotheses. Economists try to do a similar thing with their predictions of future business cycles, but human affairs don’t reproduce themselves as often or as completely as natural phenomenon. For example, we’ve been through many recessions, but each one has different conditions. Natural phenomenon are more frequent than recessions and more similar to each other, so it’s easier to isolate for the new data that you’re interested in.
Second, and more importantly, real scientists (i.e. climatologists, astronomers, geologists, etc.) are able to break their problem down into atomic pieces. Then, when they put the knowledge they’ve gained about the pieces together to represent the complex system as it naturally occurred, they have a better understanding of what’s really going on. Economists aren’t able to do tests on the atomic pieces of the economy. Or rather, they attempt to do so in their studies of micro-economics, but it’s an unproved axiom that micro-economics correctly captures the atomic bits of macro-economics.
Again, I’m not dissing economists. What they’re trying to figure out is difficult, and they’re doing the best they can. But they’re not true scientists, just as the other soft sciences are true sciences either. Sociology, psychology, economics, and all the rest have valuable things to say. But they’re not true science.
Edit - God damnit. Kraaze beat me again. And this time he did say some of the same things. Screw you!
As always I’d just like to point out the contrast between the poor predictive power offered by economics in real life and the certainty with which people make assertions about the world via economics. It just doesn’t add up.
There are a lot of things that separate economics from climate science. The biggest factor is just a few orders of magnitude of complexity. Ultimately climate science comes down to understanding interactions between molecules that CAN be recreated in lab settings. Ultimately economics comes down to understanding interactions between people which themselves are vastly complex systems of which we have at best an extremely poor understanding.
Furthermore, climate science, while it may have to offer really broad error bars, is doing a lot better on the predictive power front. Ultimately you can’t make these broad characterizations but have to dig down into the actual results and at that level climate science is kicking economic’s ass.
