Income Guarantee Schemes And The Developed Countries

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Income Guarantee Schemes in the Developed Countries

YE YUAN

ECON 3405- Critique of Capitalism—Fall 2014

Abstract
This paper describes several income guarantee schemes in United States, United Kingdom and Japan, which could represent most developed countries in the world in this field. The first half part of this paper tells that income guarantee schemes in these three countries have both similarities and differences because they have really different histories in development. The second half part discusses the significance of minimum wage policy and some its influences on several issues. At the last of the paper, I present my own opinions on issues of income guarantee schemes.
I. Introduction
Employment is a popular topic in
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For this reason, income guarantee schemes are necessary to economic growth and social stability. Most developed countries are in North America and Europe, however in Asia Japan is a developed country with strong economy foundation. So I choose United States, United Kingdom and Japan to describe this issue.

II. Income guarantee schemes in United States
As the strongest developed country in the world, United States had legislated minimum wage to guarantee income for workers in early time. Minimum wage is an efficient tool to improve labor market in history. However, the first country legislated minimum wage is New Zealand that was enforced by compulsory arbitration (Verrill, 1915:105). United States legisted minimum wage system with the Fair Labor Standards Act of 1938 and set the federal minimum wage is $0.25 per hour. The 1938 Act was applicable generally to employees engaged in interstate commerce or in the production of goods for interstate commerce (US Department of Labor, 2009). Then the minimum wage level increases several times because of productivity improvement and increasing inflation rate. The federal government has to update the minimum wage level frequently. In 1961, there was new policy extended coverage primarily to employees in large retail and service enterprises as well as to local transit, construction, and gasoline service station employees (US Department of Labor, 2009). In 1966, the labor system
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