For the writing assignment, I give you a policy issue or situation that you are asked to comment on using economic analysis. You may submit no more than 2 pages. It must be typed, double-spaced with 10-12 point font and 1-inch margins all around. Please use Times or Times New Roman font. If you want to use graphs to support your arguments they may be on additional pages but should be drawn with a program like MSWORD or PowerPoint, and pasted in as pictures.
In the aftermath of California and New York becoming the first states to raise the statewide minimum wage to $15, some small businesses with hourly workers are rethinking how they can absorb the increase. According to an article by Joyce Rosenburg, https://www.stltoday.com/business/local/as-minimum-wage-marches-toward-small-businesses-adapt/article_f2e44b8a-4cba-5edd-82be-2c4a17942abc.html, one restaurant may have owners pick up food at a counter instead of delivering it to tables. It may also have workers do more tasks, for example, a cashier doing some administration. Rosenberg notes some businesses are cutting staff, others are raising prices. Meanwhile a pizza chain in Washington DC is giving raises without raising prices because of solid revenue growth. A smoothie business in NYC suburbs has raised prices 30%, as has a seafood restaurant chain in Seattle. It is also a fact that a manufacturing firm in Seattle is replacing some labor with technology. Using production and cost theory, and profit maximization rules, contrast and discuss these different reactions, and perhaps discuss how the different responses gives us some insights about how much market power the different businesses have.