We heard about general equilibrium and the emphasis on the relationships between two or more markets in this week's content. When governments interfere in competitive markets, their decisions frequently have far-reaching effects that affect more than just one market. The minimum wage, which extends to both covered and uncovered markets, illustrates this. Wages for covered jobs increased, but not at the expense of those in the uncovered sector. In addition, based on the elasticity of the two markets, overall jobs could have decreased.

What other examples do you have of government policies that have an effect on different markets? Can you think of those that have unintended repercussions, such as the minimum wage example? Do you think "universal" policies, such as a nationwide minimum wage, will produce greater results since it limits the option of an uncovered sector?