The tragic irony of the regulated workplace is that it most adversely affects those on the margins of society...
Tragically, a higher minimum wage and workplace-safety regulations are likely to exacerbate rather than mitigate social inequalities by removing the penalties that discriminatory employers would have to pay in a competitive market and by eliminating an important margin on which disadvantaged groups could compete.
When people aren't allowed to compete on the basis of price, quantity, and quality, firms can discriminate on the basis of something other than productivity.
A racist employer would suffer a penalty (lower profits than his competitors) if he insisted on indulging a "taste for discrimination" in a competitive market. When prices are fixed, and labor conditions are set by law, that same employer can indulge his racist preferences without receiving his capitalist comeuppance...
One of the unintended consequences of the minimum wage and workplace regulations is that they perpetuate inequality...
But racism is an entrepreneurial error, and one that should be quickly punished in the marketplace. With restrictions on the way the labor market functions, the entrepreneurial error (and moral abomination) that is racism can go uncorrected.
Milton Friedman openly argued that minimum-wage laws are racist in effect if not intent...
Denied the opportunity to earn incomes and to acquire valuable skills, those adversely affected by the minimum wage were not allowed to share in the general prosperity that a market economy produces...
The Minimum Wage, Discrimination, and Inequality - Art Carden - Mises Institute
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