The brilliant economist John C. Goodman is out with another brilliant column. This one about the foolishness of minimum wage laws. See here. :
To summarize: a firm that pays workers more than they are worth cannot survive because it cannot match the prices and the rate of return to investors of its rivals. A firm that pays workers less than what they are worth, cannot survive because it will not be able to retain its employees. Competition in the marketplace tends to determine wages; there is a definite logic to what people are paid; and it has nothing to do with miserliness or generosity.
