Another question about the minimum wage. It is supposed to raise households out of poverty, but half of the workers at the minimum wage level are 16-24, and more than half of this group live at home in houses that live above the poverty line. So an increase in the minimum wage subsidizes homes above the poverty line more than those below.

@emacs, it also allows those 16-24 year olds start thinking about creating their own households, which is usually a rather expensive exercise - likewise this increases consumption and thus helps economic growth (not that i'm in favour of economic growth, when we should be attempting to minimize our ecological impact and move toward 100% recycling)

Emac, thanks for the Neumark and Wascher paper. Its worth noting that Neumark and Wascher are the most notable proponents of the "adverse effects" conclusion over the past 20 years, while Card is the most notable proponent of the "no significant effects" conclusion, although I think in the past decade or so he has been more focused on other issues. This isn't to say that Neumark and Wascher aren't good economists -- its just important to realize that their papers don't represent any sort of consensus on the matter. Instead, I think that article you posted was most interesting in how it showed that there is still a bunch of research being published on the subject that reaches a variety of different conclusions. I don't think it is clear that raising the minimum wage would represent a trade-off of higher wages vs. job losses because it hasn't yet been settled that these job losses are significant, or even exist.

In response to your second post, I agree that some of the people benefitting from the minimum wage are secondary earners in high earning households. When I was younger, I definitely benefitted from the minimum wage in this way.

However, I don't agree with you that an increase in the minimum wage subsidizes those above the poverty line more than those below. I'd be interested in the source for your numbers, but even assuming they are correct, I would expect that those between 16-24 who work full-time on minimum wage are less likely to live at home than their peers who don't work full-time on minimum wage. Its also possible that if those youths weren't earning the minimum wage, their homes would no longer be above the poverty line.

Of course, no policy instrument is perfect and the minimum wage is probably a pretty blunt one. That doesn't mean it is not very worthwhile.