One thing I don't fully understand is why the equilibrium for the demand/supply of labor is not enough to live on. Why does the hiring party get to be more picky (and thus pay less) among potential employees, while employees get to be much less picky in their job? Some theories:
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Maybe 'not enough to live on' is a false premise - maybe the natural equilibrium *is* enough to live on for a subsection of people, and artificially pushing the equilibrium upwards (minimum wage) somehow has spillover effects onto people who need higher pay (like a family)
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Maybe there's something weird specifically with *low* pay labor/demand markets. High paying jobs often do feature very strong employee power - lawyers can make private practices; head hunters try to poach employees, etc. Why is the equilibrium inadequate for low wage categories?
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Maybe there's not enough 'natural' competition among companies at low wages? Just, not enough jobs in general offering entry level positions. If more jobs opened up, employees could put way more pressure on companies, and wages would naturally increase to be competitive.
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Basically, I'm operating under the assumption that the need for a minimum wage is abnormal. The idea that we have to literally ban the option for consenting adults to agree to certain types of exchanges means that something else is very wrong inside the system.
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My priors make me want to guess that regulations that make it difficult for new businesses to pop up, or tax burdens that make it difficult to hire more employees, and lobbying'd laws from corporations that suppress competition, are the real culprits for low equilibrium.
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Haha. Amateur/libertarian economic theorising does make me laugh. It's almost as if thousands of academic papers about sticky wages and asymmetric knowledge/power dynamics in imperfect markets had never been written...
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Run the simulation forward a hundred generations at a given technology level, and the median wage will equilibrate to be enough to support survival and raising two kids. Until then, there's no reason to expect we're in a Malthusian equilibrium....
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If you’re looking for work in a booming field, and there aren’t enough workers to fill those jobs, the roles are reversed. Truck driving is a good example of that at the moment. Employers are desperate for drivers, and wages have gone up as a result.