There really is no such thing as a free lunch. Only lunches of variable cost. And if we increase the cost of one of the major inputs into such lunches then something else will give. Here, as a result of the rise in the minimum wage Chipotle has raised prices in that specific location where the minimum wage rise occurred.
This doesn’t help minimum wage earners: some unknown but knowable reduction in sales of reasonably priced Mexican food will take place as a result of this price rise. Demand curves really do slope downwards. Thus some unknown but knowable number of people will not be employed to produce said food.
As we’ve been saying all along: a rise in the minimum wage really does destroy jobs.
Tuesday, July 7, 2015
We Are Seeing The Effects Of The Minimum Wage Rise In San Francisco
Nice article in Forbes.com: