Price Floors
when price floors or minimum Prices are set for Particular items, the intent of the government usually is to increase the incomes of those who sell them. Under what circumstances are Price floors likely to be set? If there are groups of sellers whose incomes are relatively low, those sellers may be able to convince legislatures or Congress that price floors are in order. or, if there are groups of sellers that are politically strong, they may be able to get the idea across with equal effectiveness A classic example is that of minimum-wage legislation. The Fair Labor Standards Act of 1938 established the first federal minimum wage of 25 cents per hour for workers in designated industries. Over the years, its coverage has been extended greatly, and the minimum-rates have been increased substantially to the present level of $3.35 Per hour. In addi- tion, many state governments have enacted minimum-wage laws of their own to cover workers not covered by federal minimums. Mini-mum wage laws have had wide support from the general public. They apply, of course, to workers at the lower end of the income scale and were enacted to combat what Congress identified as labor conditions detrimental to the maintenance of the minimum standard of living nec- essary for health, efficiency, and general well-being of workers. Re-cently, and general well-being of workers. Re-cently, much attention has been directed to the minimum wage as Congress and the President have proposed increasing the minimum. Price floors on certain items also may come about in ways other than through direct legislation. In the barbering trade in many states, barbers of each county or city may get together and establish minimum