contestada

An article in the Economist about Venezuela​ stated: "The economy is in such an appalling​ state, and inflation is so​ high, that Venezuelans greeted a rise of​ 60% in the minimum wage on May 1st with shrugs of​ 'so what?'." ​Source:​ "It's Up to the​ Army," Economist​, May​ 6, 2017. What would be a reason why the people of Venezuela would shrug off a rise in the minimum wage of 60​ percent?

Respuesta :

reurisoneco

Answer:

The very rise in inflation.

Explanation:

Inflation in Venezuela is very high. In this sense, the population would avoid the 60% increase in the minimum wage because this value would not replace inflation. In other words, inflation is rapidly eroding the Venezuelan's salary and the replacement is well below the inflation value. Rising wages, on the other hand, further contribute to rising inflation, as rising wages raise demand and raise prices, worsening the situation, leading the population to avoid rising.