Can someone answer my question about the minimum-wage hike?

[whatthehey]

46. I can't say I've seen data on regional MPC. I suspect little variation

If you are poor in Manhattan NY or poor in Manhattan KS you still have unmet needs and certainly wants. You'll still spend extra income. While some of that money will leave local economy, at the subsistence level current MW is, thst won't be a huge ratio. Food and shelter and transportation are local economy spend for the most part. It's comfortable folks with lower marginal propensities to consume who are ordering $500 espresso makers from Amazon. After that people tend to spend money on both improvements to lifestyle like a tumble dryer instead of a washing line and entertainment like eating out. Both again dominated by local spending. Middle class and above spending is more likely geographically widespread with vacations, luxury items not found in those backwoods burgs of yours, major league sports etc. And remember what kinds of businesses are in those burgs? There aren't too many Maserati dealers and pet spas in East Bumfuck ID. There are convenience stores, bars, mechanics, pizza joints and gas stations though, all of which see large gains with greater disposible income among the poor.

Of course there are some risks to massive MW increases, but they are systemic not local. Inflation is first among them, but competition and automation have tamed that lately. Automation is a threat itself too, but East Bumfuck Burger King is likely to be the last not the first to have the CAPEX basis to invest in that.

Will individual businesses suffer? Of course, but it will be by consumption shifts a huge minimum wage hike will cause not the MW itself. If I owned laundrettes I'd be nervous when more customers can afford home laundries. Payday loan offices will likely see lower traffic. But shifts in customer bases and externalities are part of the risks of doing business. People who opened video rental stores in 1985 were fools if they weren't looking to do something else by 2005. People who opened Italian restaurants needed to change menus when their neighborhood became Chinatown.