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A needle in the haystack: do increases in the minimum wage cause employment losses?

  • Wages
  • Employment
  • Economics


Does increasing the minimum wage lead to employment losses? For decades conventional wisdom has said 'yes' to this question but, at present, the literature on the topic in Europe and the United States is evenly divided. A recent Australian study which examined the impact of statutory minimum wages in Western Australia reached conclusions which supported the conventional view. in this paper Ian Watson argues that weaknesses in the Western Australian study make its claims unsustainable. The employment impact of raising Australia's minimum wage rate remains unclear.

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