Newsday's article, "Greek Parliament Backs New Pension Reforms" illustrates some topics present in microeconomics. Greece has been struggling economically being in debt for roughly five years of late. Greece has been attempting to reform their economy to fix this issue. Many of their newest reform ideas are listed in this recent article. One of these reforms is to lower minimum wage.
From an economic standpoint this decrease in minimum wage will help the labor market. Minimum wage is designed to improve the well-being of the employed population, but it increases the amount of unemployment because it acts as a price floor that creates deadweight loss. An increase in minimum wage creates a decrease in demand for labor thereby decreasing the supply of employed workers in the labor market. This decrease in minimum wage will decrease the well-being of the employed population, but it will also create more jobs. With Greece's massive unemployment rate, this new reform will most likely be beneficial to the population because it will most likely help more people in need of jobs than it will hurt those who already have existing jobs.
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