54 MINIMUM WAGE LEGISLATION IN VARIOUS COUNTRIES

tions approving the work of the State minimum wage commission,
and that the merchants are to-day of the same attitude of mind:
They are convinced that while the $16 a week minimum did slightly increase
‘he cost of operation, it was a cost that could properly, as readily, be passed
to the public and that it has accomplished the elimination of the necessity
of competition with the worst employer on his own grounds in a way that no
nther method could accomplish. In other words, were there no law—with
competition as keen as it is—the merchants would be forced against their
own wishes to maintain the price levels of the least conscientious stores by
holding wages down to their level.
The law has had none of the effects feared by those who originally regarded
it ag a radical venture. There has been no limitation on the earnings of the
hetter workers, nor, directly as a result of the law itself, any dismissal of
the poorer workers. * * * No business interests have suffered through
the existence of the law.
On behalf of the Merchants and Manufacturers’ Association of Los
Angeles, Calif., Edgar R. Perry makes the following statement :*!
it has been our observation that the minimum wage law for women has
seen uniformly beneficial to business and industry in California. It has had
Lhe support of this association from the beginning, and we have not observed
any serious conditions which would indicate the necessity for its repeal.
These statements seem to show that application of minimum wage
laws in cooperation with employers’ associations helps to standardize
industries and to eliminate unfair competition and contributes to the
maintenance of industrial peace.
Increases of Prices

Taking up the disadvantages claimed to result from the laws, it is
claimed first that there is an increase of prices. This is undoubtedly
true. While a certain part of the higher wages may be mude up by
greater efficiency of the employees or by a reduction of the profit maroin
 of the employers, it is obviously in the nature of things that the
oreater part of the increase in wages is passed on to the public in the
shape of increased prices, as Mr. Neustadt, speaking for the Retail
Merchants’ Association of San Francisco, expressly states. In poor
countries such an increase of prices may necessitate serious thought,
but in the United States this does not seem to be a matter of great
importance. As to the contention that the higher prices will prevent
any increase in real wages of the beneficiaries of the laws, the disproportion
 in the United States between the number of beneficiaries and
the general population makes it obvious that the increase of nominal
wages of such a small percentage of the American wage earners can
not possibly lead to such an increase of prices as to prevent an
advance of the real wages of the beneficiaries.

Effect on Interstate Competition

Another argument against minimum wage legislation is that of
njury to business—particularly the danger that industries working
mder minimum wage awards may be handicapped in interstate competition.
 While the restriction of the minimum wage to certain
States to the exclusion of others in the same customs area may render

i Latter dated Mar. 20. 1928.