When the employer has wage-setting power, a minimum wage can raise employment, the competitive vs. monopsony debate.
Warming up the engine…
A labour market with a single dominant employer: hiring one more worker requires raising the wage for everyone, so the firm hires fewer workers at a lower wage than a competitive market would.
Hire where MCL = MRPL ; wage read off supply, below MRPL
The marginal cost of labour lies above the supply curve because each new hire's higher wage goes to all existing staff too. The firm stops hiring early and pockets the gap between what workers produce and what they are paid. This is why a carefully set minimum wage can RAISE both wages and employment here: it flattens the marginal cost of hiring.
The monopsony case is the exception that reverses the standard minimum-wage prediction; cite Card and Krueger's New Jersey study as the evidence that made it mainstream.
Now prove you have it
Move the curve to where you think it lands, and get told exactly which part you got right.
Real-world scenarios on this model
Equilibrium at L 44, w 32.
Equilibrium: L* = 43.8, w* = 31.9
Current equations
One big employer in town. To hire one more worker it must raise the wage for EVERYONE, so the true cost of hiring (dashed MCL) climbs faster than the wage itself. Result: fewer jobs at a lower wage than a competitive market would give.
Source: Borjas, Labor Economics, ch. 4; Card & Krueger (1994)