Minimum wage advocates love to point to Australia’s $16.88 an hour minimum as evidence that a very high wage floor needn’t stifle a country’s growth. After all, Australia hasn’t had a recession in 20 years. But Australia is hardly an outlier. Most developed countries have a higher minimum wage than we do. The U.S., unsurprisingly, is on the bottom but it’s tied with Japan. And Australia isn’t on top; that goes to France, which has a lower average wage than Australia, which makes up for a lower minimum wage and leads to a higher ratio.
via The U.S. has a $7.25 minimum wage. Australia’s is $16.88
It might be that the mindset in the US is an irrational belief that depriving companies of profits with higher wages must be punished with layoffs. It has reached the level of self-fulfilling expectation. Psychology is always the most significant dynamics in economics.