Setting a minimum wage increases workers’ standard of living as the general income of workers is increased by establishing a price floor. As such, they will be able to afford higher quality goods, thus reducing poverty and leading to an improved living standard.
Looking at Maslow's hierarchy of needs, we can see that the minimum wage thus helps people to be able to better fulfil the base of the pyramid (physiological needs and safety) as they have more money to afford things like food and provide better security for their families by creating a more stable home. As such, they are now able to work on fulfilling the higher level of the pyramid such as the esteem level. This thus boosts their morale and thus they can focus on other things, therefore increasing their production ability. This thus helps the businesses too as their productivity is now increased which can thus improve the production of their goods.
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The graph above is based on a study done on the economic well being of 24 industrial democracies around the world. The relationship is a very positive one whereby an increase in the minimum wage has resulted in an increase in percentage of the population thriving economically. This thus shows that minimum wage is beneficial in improving the standard of living of the people.