This story would be funny if there wasn’t so much human misery involved. Venezuela has been dealing with true shortages for several years. I’ve written about this before (including the Continue Reading →
Scarce goods and services (pretty much anything with a price) must be rationed somehow. Letting the price of a good adjust takes care of the problem automatically. If the price is below equilibrium, quantity demanded will exceed quantity supplied. The price will rise until the two quantities are equal. Continue Reading →
Economists recognize three main impacts of the minimum wage. The two I will be concerned with here are impacts on employment and impacts on income distribution. The third effect, the impact on total income, I’ll deal with in a cursory fashion.
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