The push for a U.S. living wage: Modeling for inflation, unemployment, both, or neither

Few U.S. economic issues in the last half-century have engendered as frequent political controversies as the minimum wage. This article looks at both the politics behind efforts to make the minimum wage a “living wage” in recent elections, and the many relevant economic effects, such as inflation and unemployment, from both a macro- and a microeconomic perspective. The paper offers several original conceptual models, in various economic situations, which examine the regressions of eight U.S. states over the 1996-2016 period. The results show that high minimum wages can harm employment, but that moderation can aid stagnant wages in economically-improving inflationary settings without drastically reducing employment short-term.