Minimum wage regulation attempts to set an hourly, or other periodic monetary standard for pay at work.
Arbitration involves makes collective agreements between trade unions and employers legally binding and mediated through a state appointed judge or magistrate.
An economic analysis of the law holds very simply that any intervention in a contract between two parties creates an inefficient labour market.
Wages kept artificially high, by imposing any administrative or monetary costs on employers distorts the labour market equilibrium.
Major proponents of this sort of labour economics include Nobel Prize winner from the University of Chicago, Professor Gary Becker.