The myth from 20th century keeps wages low

Most of my fellow economists still live in the last century. In the textbooks from the previous century. And with these textbooks they still teach students that bad guys are on the labour market trade unions. Because they have a monopoly over their work as a production factor, which makes the price of labour (pay) formed to the left of a perfectly competitive balance - in terms of wages that are lower than the marginal labour costs, which makes employment less than optimal. And they still teach students that the statutory minimum wage is poor. For the same reasons as the "harmful" role of trade unions. The rise in the minimum wage further reduces employment. Both of them are poorly squared. Not.

But these are all the textbooks of the past century. Research over the past 20 years since Card & Krueger (1995) on the Minimum Wage Myth. and the research by Jason Furman, former head of the Barack Obama Council of Economic Advisers, on a monopson on the labour market, show a completely different picture. They show that the minimum wage does not kill jobs and that the dominant power of employers over employees keeps wages below the marginal cost level. The ultimate effect is the retention of wages at a low level and below the existential level while at the same time lowering the employment than optimal.

While we are waiting for new textbooks, the picture of the monopson in the labour market below will replace the picture of the monopoly of trade unions on the labour market (explained below).

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