A Variable Minimum Wage?


Over at the newly-opened TPMCafe, Senator John Edwards is talking about raising the minimum wage. As he should be. We’ve done posts before on why the minimum wage should be raised (here, here) and why it needs to be done in conjunction with the Earned Income Tax Credit (here), but one of Edward’s commenters brings up another very good point: An effective minimum wage would vary from community to community, based on area food and rent costs. That certainly makes sense—a decent living wage in Manhattan, KS, wouldn’t get you very far here in San Francisco—and it doesn’t seem like the implementation should be all that difficult. The danger, of course, is that businesses would start shifting around to avoid high wages, but I’m not sure how big of an effect that would be, since there are certainly other reasons to sit a business in, say, San Francisco besides the minimum wage levels. (Besides, if enough businesses left a given area, rents would go down, so wages would go down and then businesses would move back in…) Something to consider.

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