Did anyone yet mention the degree of concentration in markets where firms typically pay workers the minimum wage? As has been remarked previously, most minimum wage workers are in their service sector but many of these markets are highly concentrated and dominated by oligopolies. Consider the fast food industry and the likes of McDonalds, Burger King, Wendys, etc.. Now, certainly if wages were to go up, this would increase each firm's costs of production, ceteris paribus. Yet, these are hardly competitive markets in the normal sense of the term and the oligopolies have a high mark-up over costs. So my guess is that if the minimum wage was increased, then these firms *might* increase prices (and this would be inflationary) -- and blame it all on the increase in the minimum wage. Still, it sounds to me more like an example of profit-push inflation than cost-push inflation since the oligopolies would use the increased minimum wage as a *pretext* for increasing prices and profit margins. Jerry
