What we do not know about the minimum wage

We were discussing the minimum wage last week in my MBA 505 Global Economics for Managers class.  Bloomberg columnist Megan McArdle did a nice job in a recent column summarizing the economics research literature.  Did she read literally 100s of papers?  I kind of doubt it, but she reaches three main conclusions:
1) Most people have their own opinions about whether the minimum wage is a good or not so good idea and they naturally seek out and site research that supports their own opinions.  Psychologists call this confirmation bias.  As is always the case in economics, you do not have to search very hard to find a study that matches your views.  Some find big job losses, others find small job losses and one very famous study found no job losses.  Out of these 100s of papers, guess which study gets cited as hard evidence by minimum wage proponents!  (Overall, the literature seems to indicate small job losses, by the way.)
2) Historically most changes in the US minimum wage have been modest, e.g. an increase from $2.65 in 1978 to $3.35 in 1981.  Some states and cities are now contemplating much larger changes, from the current $7.25 to $15.  It is quite possible that research done on small hikes does not translate into larger ones.  For instance, automation opportunities that McDonalds would ignore at a $1 increase may be too tempting to pass up at the President's proposed $3 increase. 
3) None of the minimum wage studies have been able to deal with long term consequences, such as how many McDonalds might end up closing or and how many never open because of higher labor costs. 

Understanding the drop in the labor force

Just ran across two items from Marginal Revolution dealing with the drop in the labor force participation rate.  Stanford econ prof Robert Hall has taken a careful look at personal and household factors and has found that most of the drop has taken place among teens and young adults.  More intriguing is the finding that the drop is greater among households in the upper half of the income distribution than the lower half, casting doubt on the theory that more generous income maintenance programs (food stamps and unemployment insurance would be the most likely culprits) are driving the shrinkage of the labor force.

A recent article in BloombergBusinessweek reaches a simular conclusion.  Young people in high income households are staying in school longer and more of them are not working.  The article also notes the growing share of the labor force claiming disability benefits; these individuals are unlikely to return to work even if the unemployment rate dips below 5 percent.

NC State Online MBA ranked #9 by US News

What a way to start the year -- US News announced yesterday that NC State's online Jenkins MBA program ranked #9 in the US.  This is the first top ten ranking for any platform of our MBA program. A year ago the online MBA program was ranked #36.

NC State's overall score was based on four components: student services and technology (#13), student engagement (#13), admissions selectivity (#16), faculty credentials and training (#69) and peer reputation (no rank reported).

What were some of the secrets to our success?  Our student retention and graduation rates have been near 100%, so that definitely gave us a leg up on the student engagement score.  As is the case with our full-time and Professional Evening platforms, our online student credentials are quite high, especially in terms of work experience.  The faculty score is a bit of a head-scratcher -- I have a hard time believing NC State and UNC-Chapel Hill (#120 on faculty credentials) are really behind Gardner-Webb and the University of the Cumberlands on this dimension.

Kudos as well to UNC-Chapel Hill for being tied with Indiana and Temple for #1.  Both of our programs have come a long way in just three years (we both started in 2012).  North Carolina residents have two outstanding choices.  Compare the programs, compare the costs, and decide which best fits your needs!