Is the Minimum Wage Ethically Justifiable? An Order-Ethical Answer

  • Nikil Mukerji
  • Christoph Schumacher


Is the minimum wage ethically justifiable? In this chapter, we attempt to answer this question from an order-ethical perspective. To this end, we develop two simple game theoretical models for different types of labour markets and derive policy implications from an order-ethical viewpoint. Our investigation yields a twofold conclusion. Firstly, order ethicists should prefer a tax-funded wage subsidy over minimum wages if they assume that labour markets are perfectly competitive. Secondly, order ethics suggests that the minimum wage can be ethically justified if employers have monopsony power in the wage setting process. As it turns out, then, order ethics neither favours nor disfavours the minimum wage. Rather, it implies conditions under which this form of labour market regulation is justified and, hence, allows empirical science to play a great role in answering the ethical questions that arise in the context of the minimum wage debate. This illustrates one of order ethics’ strengths, viz. the fact that it tends to de-ideologize the debate about ethical issues.


Minimum wage Wage regulation policies Ethics Efficiency 


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Copyright information

© Springer International Publishing Switzerland 2016

Authors and Affiliations

  1. 1.Faculty of Philosophy, Philosophy of Science, and the Study of ReligionLudwig-Maximilians-Universität MünchenMunichGermany
  2. 2.School of Economics and FinanceMassey UniversityAucklandNew Zealand

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