Paul Krugman: The Minimum Wage Is Too High In Puerto Rico

Paul Krugman explains why the minimum wage can be a problem for even a statist like himself:

A recent report commissioned by the commonwealth’s government argues that its economy is hurt by sharing the U.S. minimum wage, which raises costs, and also by federal benefits that encourage adults to drop out of the work force. In principle these complaints could be right. In particular, even economists who support a higher U.S. minimum wage, myself included, generally agree that it could be a problem if set too high relative to productivity — and Puerto Rican productivity is far below mainland levels.

Imagine that.