> It's not clear to me that raising the minimum wage, and therefore the price of a restaurant meal
This study[1] specifically looks at the effect of raising the minimum wage on restaurant prices.
What they found is that increases of 10% to the minimum wage are correlated with only a 0.36% increase of prices, and minimum wage increases may cause some prices to decrease, too:
> Many business leaders fear that any increase in the minimum wage will be passed on to consumers through price increases thereby slowing spending and economic growth, but that may not be the case. New research shows that the pass-through effect on prices is fleeting and much smaller than previously thought.
> By looking at changes in restaurant food pricing during the period of 1978–2015, MacDonald and Nilsson find that prices rose by just 0.36 percent for every 10 percent increase in the minimum wage, which is only about half the size reported in previous studies. They also observe that small minimum wage increases do not lead to higher prices and may actually reduce prices. Furthermore, it is also possible that small minimum wage increases could lead to increased employment in low-wage labor market.
That seems pretty hard to believe to me. I suspect they didn’t take into account all the efficiency gains technology has enabled in that time period. Otherwise let’s just increase minimum wage by 100% if it will only raise prices by 3.6%.
This study[1] specifically looks at the effect of raising the minimum wage on restaurant prices.
What they found is that increases of 10% to the minimum wage are correlated with only a 0.36% increase of prices, and minimum wage increases may cause some prices to decrease, too:
> Many business leaders fear that any increase in the minimum wage will be passed on to consumers through price increases thereby slowing spending and economic growth, but that may not be the case. New research shows that the pass-through effect on prices is fleeting and much smaller than previously thought.
> By looking at changes in restaurant food pricing during the period of 1978–2015, MacDonald and Nilsson find that prices rose by just 0.36 percent for every 10 percent increase in the minimum wage, which is only about half the size reported in previous studies. They also observe that small minimum wage increases do not lead to higher prices and may actually reduce prices. Furthermore, it is also possible that small minimum wage increases could lead to increased employment in low-wage labor market.
[1] https://www.upjohn.org/research-highlights/does-increasing-m...