Advantages and disadvantages of minimum wage laws

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Advantages and disadvantages of minimum wage laws

Businesses need to respond to a variety of changes: Social changes In the 19th century, the majority of people lived in small rural communities, with high cost of goods to small scattered stores. Montgomery Ward operated a mail order service, delivering products at lower costs than those charged by rural stores.

But as urbanization happened in the s, urban department stores became more efficient, leading to the rise of JC Penney. Economic changes Technological changes Rockefeller produced new products from petroleum, extracting more value and reducing the price of its main product kerosene, instead of letting it go to waste.

Newspapers were the primary means of disseminating news, until the Internet made them largely obsolete. Digital cameras made film photography like with Kodak obsolete. Ironically, Kodak invented the digital camera. Business model changes With the rise of credit cards, retailers often ended up making more profits from managing their own credit card programs than from retail.

Changes in business leadership Often companies fail to adapt because their calcified ways of doing things are not efficient at producing the new type of product people want.

Specialization and Middlemen A company is limited in the range of functions it can perform efficiently. Only a certain number of links in the value chain can be mastered and operated efficiently by the same set of people.

Advantages and disadvantages of minimum wage laws

General Motors is excellent at making automobiles, but it leaves tire manufacturing and car sales to others. Compared to local dealerships, it is too much for GM to track local conditions across the United States, decide where a lease location is most effective, understand the trade-in value of a Honda in Seattle vs Miami, etc.

Middlemen exist when they can do their part of the chain more efficiently than others can. Eyewear brand Warby Parker sells direct to consumers using the Internet as distribution instead of paying for presence in retail stores, thus cutting out a middleman like Sunglass Hut.

Conversely, tech companies used to build and manage their own computer servers at great expense, but now have largely outsourced to convenient providers like Amazon Web Services. Instead of ten farmers taking time off to carry their produce to town for sale, one middleman collects the produce of many farmers and drives it to a buyer.

In contrast, in the US, a farmer may own vehicles and siloes that are so efficient they make a middleman unnecessary. Society as a whole saves on the amount of resources required to get the produce on the market, with the cost being the profit made by the middleman.

Similarly, in developing countries, there are often more middlemen between the manufacturer of goods and the consumer.

The limiting factor here is the poverty of the consumer, who can buy much less at once. In Africa you might see small traders sitting with their wares outside retail stores, selling volumes as small as half a cigarette.

Here, the store owner clearly sees it as less efficient to break down their packaged goods into minute quantities and to handle tiny transactions, and is thus content to outsource that consumer need to a middleman.

Higher in the chain, it is not efficient for Nabisco or Philip Morris to break down their pallets into individual-cigarette sized packages.

In more prosperous countries, technology would reduce the number of middlemen, with each producer producing more output, storing it more efficiently, and transporting a greater volume on highways; and with each consumer buying more at once.

Download "Summary + PDF: Basic Economics, by Thomas Sowell" as PDF. Have you ever wondered how the economy works – how millions of individuals can buy and sell goods and services without a master coordinator? Jan 02,  · Most of use would agree that sweatshops are not a good thing. Eventhough they may have some advantages overall they are a disadvantage to humans. A patent is a form of intellectual property.A patent gives its owner the right to exclude others from making, using, selling, and importing an invention for a limited period of time, usually twenty years. The patent rights are granted in exchange for an enabling public disclosure of the invention. People who are employed to do research are often obligated by their employment contracts to.

Peak Capacity In industries with fluctuating demand, enterprises often need to reserve enough capacity to handle peak volume, which means there is excess capacity at non-peak times. In non-peak times, prices will lower to attract budget-conscious consumers — like cruise ships offering reduced fares in the off season.

Budget-conscious travelers tend to prebook in advance to lock in rates, leaving the higher-priced hotels more subject to fluctuations. When travel reduced inluxury hotels had to discount their goods to fill excess capacity.

For efficiency, ideally the toll should increase in peak demand times and be costless in other times, shifting demand to other hours. This would smoothen out demand and even reduce the amount of capacity required, lowering the cost of construction.

Advantages and disadvantages of minimum wage laws

However, politically these efforts are unpopular, given the number of toll payers who would be disadvantaged. Inventory is a substitute for knowledge — if a factory knew exactly what parts were needed at what times, there would be no inventory needed.

They can rely on this because of high reliability from upstream manufacturers and delivery services, who themselves compete on quality and price in the market economy. Reliability is a matter of economic life and death for vendors.Fast forward 25 years: Joe is an Enrolled Agent with a MS in taxation, while Daina has started & finished a 16 year career as an ICU RN and has joined him in the office as a preparer and website geek.

There are several situations where a Chapter 13 is preferable to a Chapter 7. A Chapter 13 bankruptcy is the only choice if you are behind on your mortgage or business payments and you want to keep your property, either in Michigan or another state, at the end of the bankruptcy process.

Income Requirements and Poverty Guidelines for can be found at the following pages - Allan S. Lolly & Associates APC. 11 Advantages and Disadvantages of Minimum Wage In general definition, minimum wage is the minimum amount of compensation that laborers must receive under the law and is regarded as the lowest wage employers are allowed to pay.

Unions have a substantial impact on the compensation and work lives of both unionized and non-unionized workers. This report presents current data on unions’ effect on wages, fringe benefits, total compensation, pay inequality, and workplace protections.

Jan 02,  · Most of use would agree that sweatshops are not a good thing. Eventhough they may have some advantages overall they are a disadvantage to humans.

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