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SDSU Reduction of Racial Wage Gap Article Discussion

SDSU Reduction of Racial Wage Gap Article Discussion

SDSU Reduction of Racial Wage Gap Article Discussion

Question Description

I’m working on a Economics case study and need a sample draft to help me understand better.

  1. Describe the main arguments of the opinion piece in a short paragraph. How do the authors argue that the increase in (and expansion of) the minimum wage in 1966 reduced the racial wage gap?
  2. The article briefly touches on the potential for increases in the minimum wage to reduce the number of low-wage jobs available. Suppose there was a small reduction in the number of jobs available for low-skill workers after the minimum wage increase in 1966. What race of workers would have been more likely to be unemployed after the minimum wage change? First, think through this question under the assumption of preference-based discrimination against Black workers. Second, think through the question if there was no preference-based discrimination, but employers used education level as a signal for expected productivity. You may find the census_educationbyrace.pdf file in the assignment instructions on Canvas to be helpful in addressing this second question. Be sure to explain your reasoning.
  3. Many of the occupations affected by the minimum wage have little room for mobility (i.e. it is rare for a low-skill, low-wage employee at a restaurant or hospital to eventually become a high-skill, high-paid administrator without making a big investment in their skills such as by going back to school). Assume there is non-zero cost to investing in skills. How does an increase in the minimum wage affect the return of investing in skills and moving out of low-skill sectors? How would this impact the long-term effects of a minimum wage increase? Provide a separate argument for how an increase in the minimum wage might increase low-skilled workers’ ability to move into high-skill sectors.

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