Economist says minimum wage hike will grow economy

Shared prosperity better for country: Krueger

President Barack Obama's plan to raise the minimum wage to $9 a hour from $7.25 would help the economy, one of his former top economic advisors says.

"I think our country will do a lot better if we have more shared prosperity," Princeton economist Alan Krueger told CNBC's "Closing Bell" on Tuesday.

(Read more: Ballot measure to enact $15 minimum wage near Seattle wins)

"I think we're hurting opportunities for the next generation because the bottom half of the country has struggled so much over the past couple of decades," the former chairman of Obama's Council of Economic Advisers added. "Raising the minimum wage a modest amount, like the president proposed, helps lower wage workers and I think that will be good for our economy."

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However, James Pethokoukis, a columnist and blogger for pro-business think tank American Enterprise Institute, holds a different view.

"While hiking the minimum wage might not cost current jobs, there is evidence it hurts future hiring," Pethokoukis said in an email to "Most economist think wage subsidies would work better and be less distortive to labor markets, but politicians prefer minimum wage laws because business rather than taxpayers foot the bill—at least directly."

—By CNBC's Drew Sandholm. Follow him on Twitter @DrewSandholm.