The minimum wage should be abolished

Thanks to PRO for this debate. Per our structure, I'm now going to defend my case without address his counter-rebuttals. Overview: You're voting CON because none of PRO's arguments have held up, whereas mine has. In fact, he conceded in his round on inequality, the efficiency wage hypothesis, and on consumption--which also means he concedes on employment. There was evidence only in my case, and nothing PRO provided could match my impacts. Consumption PRO begins by conceding that the minimum wage could boost consumption. This not only bolsters the impacts in my C1 from the CBO study--$31 billion in new income--and from the Aaronson and French study--$48 billion in new spending--as well as the Aaronson et al. study--$700 per quarter for households with MW workers--but also amounts to a concession on unemployment. If the MW induced unemployment, as PRO claims, it would lead to a decline in consumption. If the MW spurs consumption, it must have had either no net effect on employment or a positive effect on employment. Per my analysis last round, this also results in me winning on capital investment. Therefore, you're voting CON on these points.He then contends that this is actually a *bad* thing. because "fewer resources will be saved and invested in longer production processes." This is patently false not only because he shows no evidence, but also because economies--paritcularly the U.S. economy right now--operate significantly below capacity. Insufficient aggregate demand, which was the cause of the recession of 2007-09, leads to less labor being utilized and thus less capital investment. The result is idle resources, underutilized capacity, and eventually a decline in worker's skills which makes those individuals virtually unemployable and works to reduce labor productivity, which lowers long-run trend GDP growth. In other words, demand-side problems can in fact cause supply-side problems. In other words, insufficient demand can in fact lead to fewer resources for savings and investments and fewer productive outlets. Without adequate consumption, you don't have savings or investment because the economy will be underutilized. His claim that savings and investmenr are the driving force of economic progress are wrong for a few reasons. First, consumption is 70% of the U.S. economy, whereas investment is only 11 percent (1). Second, investment is the most volatile portion of GDP, which is why consumption tends to drive most economic recoveries. Third, PRO's endorsement of the Austrian school runs counter to recent economic data. Per their analysis, recessions result not from insufficient demand, but from a maladption of resources, meaning that high unemployment should be accompanied by high inflation. But headline measures of inflations are hovering below 1 percent--far below target--even as the economy picks up steam (2), showing that demand is a driving factor of inflation, and is insufficient as present. Because of this, boosting consumption would be beneficial to the U.S. economy, which is precisely what the MW does. Efficiency Wage HypothesisPRO says that I made a *claim* about the MW benefitting businesss, when in fact I provided a significant amount of evidence for every argument I made. You'll note that he never once disputed a single study I provided, which noted that the costs of raising wages would be offset by gains in productivity, reductions in labor turnover, drawing in of better workers, improved employee discipline, and more. This also boosts my unempoyment contention because it lays waste to the argument that increase costs to business would spur layoffs.PRO does nothing more in response to this contention than argue that, if this held, businesses would see it and raise wages. This is undermined by my earlier remarks on imperfect markets, imperfect information, and lack of rational expectations, which PRO drops. As I noted earlier, businesses were able to profit substantially over the past three decades with flat wages--which by themselves gives them little incentive to implement it, especially because they don't have perfect knowledge that X wage leads to Y productivity. The point is they would've done better, and the gains would've been more broadly distributed, had they done so in the context of higher wages. His arguments on politicians "making a mistake" is non-topical, because I'm not advocating for a bloated $100 minimum wage. In fact, this resolution only requires me to argue for some minimum wage which can at least partially compensate for wage differentials because employers will not pay workers "what they are worth," and those theoretical values upon which PRO's case is predicated are artificial and intangible by nature. The "profit-optimizing rate" he speaks of is nothing more than an arbitrary theory in microeconomics, but the truth is no one knows precisely where that point is. Even in a basic monopsony model a MW actually increases employment (3). InequalityPRO claims that my use of the Autor et al. study is misleading, but this also isn't true. The inequaliy we're discussing with respect to the MW is inequality amongst low-wage workers. The number I cited, he rightly notes, does show lower-tale inequality, which only bolsters my case further because if we were actually to compare wage rates to the "top 1 percent," the disparity would be far greater. In fact, in 1981 the ratio of CEO pay to average wages was 42 times, but now it's over 380 times (4). My points, then, completely stand: inequality has been increasing from the late 1970s on, largely due to Reagan's policies (which PRO dropped), and even though the real value of the MW has fallen significantly, incomes at the top of the income spectrum have increased rapidly. PRO concedes that this is the case, but claims it's a good thing. In the process, he completely drops all of the evidence I provided from Joseph Stiglitz: this spurs boom-and-bust cycles which result in recessions, dampens consumption, prevents the middle class from investing in their future and thus eroding social mobility, and holds back tax receipts. All of these impacts are uncontested, and far outweight any of PRO's. PRO's C3 was already refuted by my remarks regarding imperfect markets, and borne out by his concession that the MW would boost consumption, which is predicated on my evidence in my C1 showing that low-wage workers are more likely to spend any additional dollar they earn.EmploymentPRO starts with the classic strawman: "Why don't you raise it to $100 an hour?" Never once did I advocate that, nor does the existence of the minimum wage rely on the ability to sustain such an exorbitant figure. There are several reasons you're preferring my evidence on employment. First, PRO only cites a single literature review on studies conducted in Canada. He doesn't provide links to these studies or any analysis of their findings, so we cannot access them. Second, he waited until his last round that I'm able to respond to post these studies, instead of posting them in his opening case, which is inherently unfair to me--especially because he only needs to copy and paste a list of studies without expounding upon their individual significance as I've done with mine. Third, I've provided several meta studies from Doucouliagos and T.D. Stanley and Wolfson and Belman, the former of which looked at 64 studies and the latter of which looked at 27. None of PRO's studies are meta-analyses, and many of them--such as Currie and Fallick, 1996 (5)--only address a limited period of time. That study in particular only looks at 1979 to 1980, which is hardly a representative sample of the MW data, which has been available since the 1930s. Fourth, none of his studies provide--or at least he has not told us whether any of them provide--analysis of any of the past literature. The first meta study I pointed to points out that much of the literature claiming that there are negative employment effects of the MW are subject to public selection bias and, upon removing that, we find that there are no net effects on employment. The study I cited from Dube et al. finds that, after accounting for spatial heterogeneity, they find that the MW doens't impact employment. Further, Dube's study confirmed research by Card and Krueger. None of the gibberish that PRO copy and pastes does a thing to assess existing literature. And, finally, PRO's studies are generally extremely outdated, most of them dating back to the 1980s and 1990s. The meta study from Wolfson and Belman uses post-2000 literature, so I urge you to prefer that.Further, PRO's own review concedes that there are larger employment effects when MW increases are faster and larger. This is not a case against the MW, especially because the prevailng proposal in the U.S. is a modest, gradual increase in the MW over the course of three years.Finally, even the case of what actually took place in Canada doesn't bear our what PRO claims it does. Canada raised its MW 25% in 2014 and its unemployment actually fell, and there's a similar case in British Columbia (6). Ultimately, you should prefer my studies, but even if you don't buy those and believe PRO that the studies are ambiguous, you're voting CON because PRO has conceded on consumption, income inequality, and the efficiency wage hypothesis, and by winning on those, I've also won on employment and capital investment. Further, I thoroughly refuted PRO's remarks by critiquing, and providing hard evidence, of the imperfection of the market mechanism and of individuals, who are not rational actors. I even provided a framework last round--which was dropped--that even if you are uncertain about the outcome of this debate from the evidence, you should side with raising the MW anyway because it's the utilitarian solution.SOURCES(1) http://tinyurl.com...;(2) http://tinyurl.com...;(3) http://tinyurl.com...;(4) http://tinyurl.com...(5) http://tinyurl.com...;(6) http://tinyurl.com...