--- title: "Meaning & Key Takeaway of: So what are the effects of increasing…" description: "\"So what are the effects of increasing minimum wages? Any Econ 101 student can tell you the answer: The higher wage reduces the quantity of labor demand..." image: "https://sms4smile.com/quotes/i/570/paul-krugman-2255_answers_so-what-are-the-effects-of-increasing-mi_256719.png" --- # So what are the effects of increasing minimum wages? Any… ![“So what are the effects of increasing minimum wages? Any Econ 101 student can tell you the answer: The higher wage reduces the quantity of labor demanded, and hence leads to unemployment.” quote by Paul Krugman](https://sms4smile.com/quotes/i/570/paul-krugman-2255_answers_so-what-are-the-effects-of-increasing-mi_256719.png) [Download](https://sms4smile.com/quotes/i/570/paul-krugman-2255_answers_so-what-are-the-effects-of-increasing-mi_256719.png) [Open image](https://sms4smile.com/quotes/i/570/paul-krugman-2255_answers_so-what-are-the-effects-of-increasing-mi_256719.png) > “So what are the effects of increasing minimum wages? Any Econ 101 student can tell you the answer: The higher wage reduces the quantity of labor demanded, and hence leads to unemployment.” [Paul Krugman](https://sms4smile.com/quotes/author/paul-krugman/) ## About This Quote This interpretation was drafted with AI assistance. It is one reading of the quote, not the author's own explanation. Higher minimum wages tend to lower employer demand for labor, potentially raising unemployment among low‑skill workers. **In simple terms:** Higher wages can cut jobs. Key Takeaway Consider wage impacts on hiring. Themes economics labor markets policy inequality employment Mood analytical cautious Type economic policy When to use this quote - policy debate - business decisions - government legislation - worker negotiations Key Concepts Supply and demand wage elasticity employment effects Questions to Reflect On - What evidence shows wage hikes boost overall demand? - How do regional differences affect outcomes? A Different Perspective May ignore benefits like increased consumer spending and reduced poverty. ★ ★ ★ ★ ★ No ratings yet [Labor](https://sms4smile.com/quotes/about/labor/) [Minimum wage](https://sms4smile.com/quotes/about/minimum-wage/) [Students](https://sms4smile.com/quotes/about/students/) [Unemployment](https://sms4smile.com/quotes/about/unemployment/) [Wage](https://sms4smile.com/quotes/about/wage/) [Wages](https://sms4smile.com/quotes/about/wages/) ## Related quotes > [“hat are the effects of increasing minimum wages?” asks Paul Krugman. “Any Econ 101 student can tell you the answer: The higher wage reduces…](https://sms4smile.com/quotes/don-watkins/hat-are-the-effects-of-increasing-minimum-wages-asks-paul-krugman-any/) [Don Watkins](https://sms4smile.com/quotes/author/don-watkins/) > [Giving a minimum wage reduces inequality significantly.](https://sms4smile.com/quotes/winnie-byanyima/giving-a-minimum-wage-reduces-inequality-significantly/) [Winnie Byanyima](https://sms4smile.com/quotes/author/winnie-byanyima/) > [High mandated minimum wages will throw people out of work and onto the welfare rolls in cases where unemployment benefits exist. 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