parados wrote:okie wrote:parados wrote:okie wrote:Advocate, put your thinking cap on, if you have one. How high would the minimum wage need to be raised before jobs begin to be lost? Or would no jobs ever be lost at any point? Just apply the laws of basic economics.
Which laws are you referring to okie? There is a difference between the reality of economics and the theories put forth by conservatives.
Have you heard of the law of supply and demand? Maybe not? As prices of goods rise, demand typically declines, given other factors are fairly static, while supply usually increases, at least for a time until the reduced demand causes the price to come down again.
So in the real world, demand for gasoline has obviously gone down in the last few years since the price went up. It MUST be so since you claim it is what happens when prices go up.
I knew we disagreed on almost everything, but I am still learning how naive you must really be. If the price of gasoline was lower, demand would indeed have been higher now than it actually is now, and supply would also be reduced, especially in the long term if there was little or no profit in producing it. The overall trend is also affected by other factors, such as growing populations and further industrial development in other countries around the world.
All of this is totally obvious.
Quote:Quote:Labor is another commodity that responds in a similar manner. As I said, basic economics that even hillbillies and hicks without a high school diploma have figured this out, so you don't even have to take Economics 101 to learn it. If you don't agree with this, how come you haven't learned the most basic of all principles of an economy, Parados?
Let me know when you can prove that the demand for gas has gone down since the price went up. Reality vs theory here okie. Reality is that there are so many factors involved in commodities that a simple price increase doesn't mean the demand always goes down at all. In reality, modest price increases have little effect on demand unless there is an alternative to that product that is quite a bit cheaper.
Price always has an effect, which should be obvious, but if it is only a very small increase, the effect may be fairly small, which when entered into the total equation, it is difficult to quantify, but the effect is still there.
Quote:Let's examine McDonalds workers making a minimum wage of $5. The price of labor is not the total price of the product. In fact the price of labor isn't even 1/2 of the product price. If one person at a McDonalds serves $100 worth of food an hour and they go from $5 an hour to $5.25 an hour it only increased the cost of the food to $100.25 for the restaurant to have no incurred costs. Hardly enough to cause someone to stop going to a McDonalds. The price of burgers vary more than that from one McDonalds to another.
The price of the burgers are not only affected by wages at the retail outlet, but all throughout the production chain from the farm to the burgers served to the customer, so yes, labor is only one factor, but it occurs from the pasture to the burger. The same principle applies to the hamburger buns and all the condiments that go into the burger.
Quote:Now let's examine cereal. Kellogs sells its cereal at a much higher price than store brands but people still buy Kellogs. Why is that okie? I guess it means that in the real world price is NOT the only factor in demand. You have to look at perceived value. It has been shown that people will often pay more for a product just because they think the higher price means it has higher quality. The reality of the real world far outweighs your simple theory that doesn't account for a thousand other things that really occur.
You are really dense, Parados. Perceived value is important, but this is all part of the value of any product that affects demand. There is a higher demand for a higher quality product, but this is always tempered and influenced by price, so if Kellogs goes to a higher price still, store brands will further cut into the sales of Kellogs. It is all part of the supply and demand equation. Price is always balanced against worth or perceived worth of a commodity. It is an undeniable truth and the very fact that you would try to argue against it makes you a blithering idiot.
