Monday, April 27, 2015

Minimum Wage and Models

The argument that says that if raising the minimum wage by $3.00 is a good thing, it must be an even better thing to raise that wage by $30.00 or even $300 is an example of the expandio ad absurdum argument. It is, like satire, an exaggeration of reality. It assumes that one can extend the argument out as a straight line, that the model is "linear." But reality is often not "linear," which is to say "not simple." The problem with so many models is exactly that. In fact it is possible to construct a theoretical model in which a small increase in the minimum wage in fact helps many low-skilled workers without harming any, yet also in which a larger increase does indeed harm most, or even all, such workers.  So the expandio ad absurdum argument indeed is generally not a sound argument against most real-world proposals to raise the minimum wage.
But ours is not a thoughtful society and our grasp of science is tenuous. Models are difficult to build with accuracy, with all the components accounted for. Killing the cats during the plague, Bush' releasing everyone's democratic leanings with military power, the war on saturated fats--all these were results of a reasonable but flawed models.
Math, graphs and stats should be viewed as dangerous tools, like chainsaws, and kept out of the hands of children and people with graduate degrees in the humanities.

No comments: