Economic Short Essay

There are two prompts for you to choose from below, based on topics we have covered in class. You can choose either prompt but you cannot choose the stance you take. Indicate which prompt you have chosen in this Google form.

After everyone has chosen their prompt, I will randomly assign the stance you are to take on the issue. You are to make the strongest argument possible for the stance you have been assigned, regardless of your personal opinion. Your essay should be between 1-2 pages in length. See the syllabus for details about formatting.

I am happy to answer questions about the essay prompt or material from the course that you need to understand in order to write your essay. I will not act as your editor or reviewer.

Minimum Wage

Imagine that one year after Seattle completed its minimum wage increase to $15/hour, researchers find employment and hours worked did not decrease, and wages increased. This implies that all cities should raise their minimum wage to the same level as Seattle's, after adjusting for differences in cost of living across cities*. Agree or disagree with this statement.

Tips: In making your argument, you should make use of our discussion of the different labor market models and what they imply about the effects of the minimum wage. The assigned reading by John Schmitt is a good reference to start with.

*For example, if the cost of living in NYC is twice that of Seattle's, then NYC would raise its minimum wage to $30/hour in this scenario. A similar logic applies if a city's cost of living is lower than Seattle's.

Immigration and agglomeration

There can be substantial economic benefits to having people and firms clustered together, also known as agglomeration economies. One way that the United States can increase its population quickly is by opening its borders. The existence of agglomeration economies implies that the United States should open its borders completely (barring criminals, terrorists, and those with serious communicable diseases). Agree or disagree with this statement.

Tip: In your essay, consider how different forms of labor (e.g. high-skilled, low-skilled, immigrants, natives) interact with each other, even within the same "type" of labor (e.g. high-skilled and high-skilled). For example, are they substitutes or complements?

Consider also where immigrants would migrate to in the United States. Is that something that can be influenced by policy?

You may also want to consider the policy's effects not just on the United States, but the world economy.