... firms to raise the wage or through the government passing a law that sets a minimum wage. In the UK the government appointed a commission to explore and analyse the economy and to figure out what should the minimum wage be and what effect if would have on the two evils of economics: unemployment and inflation. The first report of the commission in June 1998 concluded that a general minimum wage of £3.60 was to be set up. The second report of the commission in February 2000 tried to analyse the effects the National Minimum Wage had on the economy. Their main conclusion was that the minimum wage was mostly beneficial to the economy. The minimum wage legislation is an example of government intervention into the market economy due to a market failure. In this case the market failure was to not provide the workers with a level of income ...

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