Wednesday, April 27, 2011

Wages Above the Minimum Wage

The New York Times has an interesting article about the Chinese labor market in 2010. The demand for workers in China has been increasing (i.e. the demand for labor has shifted to the right), and has increased so much that the market wage for workers in China is above the government set minimum wage. This is an excellent example showing that market forces can make a government policy (i.e. the minimum wage) non-binding.

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