Economics Part B

Minimum wage

Minimum wage Explained

The Minimum wage which the employer is required by law to pay to his workers.

In the US, the federal Minimum wage as of 2009 is $7.25 per hour, and any employer paying his workers less is committing a criminal offense.

The logic behind the setting of a Minimum wage is the desire to ensure that workers receive a fair Minimum wage for their work. This is based on the assumption that in conditions of unemployment (the supply of workers exceeds the demand for workers) a situation could arise where certain workers would agree to work for salary which is so low as to represent a form of exploitation of those workers.

Minimum wage589Minimum wage