That example is too narrow/shaky. It requires employer to have some sort of monopoly on employing that worker (otherwise why would the worker keep working for that employer for $X/hour in the first place?).
I was asking about example when employee's gain (from increasing minimum wage) would be more reliable and would not depend on chance so much.
Gambler has a chance to win, but gambling is not a good way to get wealthier.
I disagree that this example is too narrow/shaky. I believe it actually encompasses a vast majority of people who are currently earning the minimum wage. Note that I'm willing to change my beliefs if my reasoning has led me astray :)
The key assumption you've made that I disagree with is this: "why would the worker keep working for that employer for $X/hour in the first place?". It seems to me that this assumption boils down to an underlying assumption that the labor market is an efficient market.
In another comment elsewhere in this thread sergiosgc makes a statement that I think is relevant here: "You wrongly assume the job market is a perfect market. It's not; there are barriers to entry, barriers to exit and lots of asymmetric negotiation positions."
My argument (and I Am Not An Economist) is that the COST of labor and the VALUE of labor (from the employer's perspective) are not necessarily equal.
A quick hyperbolic example of a labor-rich job market that demonstrates this difference:
* Your labor market has 1,000,000 people
* You are offering the only job in the labor market. For every hour the lone employee works the job will generate $500 of additional revenue for your company.
* There is no minimum wage, and your goal is to minimize your costs while maximizing your revenue.
What is the price you pay your employees under these conditions? It's not $500/hour. It's probably only room and board.
If we introduce a minimum-wage of $5/hour, what is the price you pay now?
If we raise the minimum-wage to $10/hour, what is the price you pay now?
If we raise the minimum-wage to $100/hour?
$1,000/hour?
I admit that this was an extraordinarily hyperbolic example, but I think the current U.S. job market is a less-extreme example of this.
1) Based on anecdotal evidence (that I'm too lazy to look up current estimates of the number of people not participating in the U.S. workforce), the current job market around the country currently favors employers. Many people are fervently searching for jobs which drives down the PRICE of labor. This doesn't change the VALUE of any particular job for the employer.
Finally, I refer you to Wikipedia where there is a rather good summary of current economic thinking on the impact of minimum wage laws on unemployment (http://en.wikipedia.org/wiki/Minimum_wage). As far as I can tell from a brief summary, currently thinking by economists is relatively mixed.
I was asking about example when employee's gain (from increasing minimum wage) would be more reliable and would not depend on chance so much.
Gambler has a chance to win, but gambling is not a good way to get wealthier.