Jobs

An Arms Race for Economists in the Minimum-Wage Debate


For advocates and lobbyists, who better to lend their claims credibility than the country’s most decorated economists? The debate over the minimum wage has seemingly left no Nobel winner untouched.

Last week, for instance, a group that Businessweek.com revealed was the National Restaurant Association issued a statement opposing (PDF) a minimum-wage increase with signatures from more than 500 economists, four of them Nobel Prize winners. On the other side of the debate, the progressive Economic Policy Institute had sent out its own letter with 600 signatures, including seven Nobel laureates. It’s like a Nobel face-off, an economist arms race.

Recruiting the support of economists is not a new strategy for those looking to strengthen their case. “We had done this periodically on various questions for the last 25 years,” says EPI President Larry Mishel. “We’re providing validation that it’s not stupid to raise the minimum wage. It has merit.” Sue Hensley, a spokeswoman for the National Restaurant Association, finds common cause with her foes at EPI on this front. “There is significant value in having the support of a large group of leading economists,” she said in an e-mail.

The approach may lose some value when each side proffers a long list of endorsers. Rather than strengthen either argument, the letters instead seem to confirm one thing everyone already knows: Economists disagree with each other.

The National Restaurant Association, in its effort to gain economists’ support, was called out in a recent New York Times story for not disclosing involvement in having initiated its statement about the minimum wage, which the group asked Nobel winning economist Vernon Smith to send out under his name. By the newspaper’s account, the National Restaurant Association asked a former Treasury Department official to approach Smith to sign and distribute the statement under his own name. Smith did not draft the statement, according to the Times, although the economist has said he supports the statement, based on the merits of the arguments.

Hensley said its opponents are focusing on the process of how its statement was circulated “instead of focusing on the ideas within the letter and the broad support it received.” Still, the next time hundreds of economists sign any statement, it could be worth considering just who is on the letterhead—and what some rival gaggle of economists might have to say.

Venessa-wong-190x190
Wong is an associate editor for Bloomberg Businessweek. Follow her on Twitter @venessawwong.

Race, Class, and the Future of Ferguson
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

 
blog comments powered by Disqus