In the most pedantic sense no. Inflation can technically only be created by increasing the money supply artificially. However this has a similar effect venue it applies unneeded artificial pressure to a free market.

This is also happens to be easy way to buy votes, using none of your own money, and has been a tried and true political play for many decades.

> In the most pedantic sense no. Inflation can technically only be created by increasing the money supply artificially.

This is the definition of “monetary inflation” rather than the more common “consumer price inflation” that everyone who isn’t a particular kind of crank means when they use “inflation” unmodified in general use (rather than internally in a very specific academic/research community.)

> However this has a similar effect venue it applies unneeded artificial pressure to a free market.

“Free markets” do not, and cannot, exist in the real world; they are not merely an idealized concept, but actually one that requires assuming contradictory things.

> This is also happens to be easy way to buy votes, using none of your own money, and has been a tried and true political play for many decades.

The long series of advocacy from multiple sides, early legislation, referenda against that legislation, and labor, industry, and government negotiations to reach a mutually tolerable resolution that resulted in this law can be described as many things, but “an easy way” to do anything is not one of them.

(The initial minimum wage increase is a tiny part of the law, whose main function is setting up a new industry regulatory authority with labor, franchisee/restaurant owner, and franchisor/chain owner representation, with general statewide regulatory authority over industry working conditions in the state.)

> In the most pedantic sense no.

True, it should be modeled as an input commodity adverse price shock -- as if the prices of some other essential, say wheat or potatoes had jumped by 30% -- though only for restaurants that fit the criteria.

> This is also happens to be easy way to buy votes

People's brains have become so poisoned about institutions that government actually helping people seems suspicious instead of its purpose.

Probably not.

It will likely result in a cut in hours for marginal workers, boosted hours for higher productivity workers and more outsourcing/automation.

Labor intensive restaurant operations will have a competitive disadvantage to capital intensive models, and so we’ll see more capital intensive ones thrive.

We'll also see more performance pressure from managers of the affected workers, and more wage theft, e.g. pressure to put in time "off the clock".

The minimum wage is just the first impact of a law establishing a new state regulatory body with labor, industry, and public representation for regulating working conditions in the industry; wage theft in the industry was one of the motivating factors.

No. But this will provide more data that it won’t.

In the big cities at least, $20 is already the floor on most fast food jobs. This will have the most impact in poorer cities and more rural towns.

It should spur more productivity via automation (like more kiosks and robots being used in fast food).

Does this imply that the difference will be coming out of the franchisee's pocket then? No one else is impacted?

They’ll probably raise prices or absorb the costs, but it’s not a big enough cost to move the needle on inflation. These people make peanuts, and will even after the raise.

The minimum wage in California is already $16, so this is only a 25% increase for this subset of an industry. This is equivalent to increasing the minimum wage to $9 in other states.