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The Response of Hours of Work to Increases in the Minimum Wage

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Author Info
Kenneth A. Couch () (Department of Economics, University of Connecticut)
David C. Wittenburg () (Research Associate, The Urban Institute)

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Abstract

This paper examines the effect of minimum wage increases on the hours of work of teenagers (ages 16 to 19) using monthly data from the Current Population Survey. Our findings are consistent with the prediction from neoclassical theory that minimum wage increases have a negative effect on labor demand. However, the estimates we provide here for the elasticity of hours of teen labor demanded with respect to the minimum wage suggest that alternative estimates based on aggregate employment consistently understate the total impact of minimum wage increases on teenage labor utilization.

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Publisher Info
Article provided by Southern Economic Association in its journal Southern Economic Journal.

Volume (Year): 68 (2001)
Issue (Month): 1 (July)
Pages: 171-177
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Handle: RePEc:sej:ancoec:v:68:1:y:2001:p:171-177

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  1. Daniel Cardona & Fernando Sanchez Losada, 2003. "Union Power, Minimum Wage Legislation, Endogenous Labor Supplies and Production," Working Papers in Economics 105, Universitat de Barcelona. Espai de Recerca en Economia. [Downloadable!]
  2. Stewart, Mark B. & Swaffield, Joanna K., 2006. "The other margin : do minimum wages cause working hours adjustments for low-wage workers?," The Warwick Economics Research Paper Series (TWERPS) 746, University of Warwick, Department of Economics. [Downloadable!]
    Other versions:
  3. STROBL, Eric & WALSH, Frank, 2004. "The impact of minimum wages on hours and employment revisited," CORE Discussion Papers 2004023, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE). [Downloadable!]
  4. STROBL, Eric & WALSH, Frank, 2003. "Dealing with monopsony power: the case for using employment subsidies," CORE Discussion Papers 2003079, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE). [Downloadable!]
  5. Strobl, Eric & Walsh, Frank, 2002. "Getting It Right: Employment Subsidy or Minimum Wage?," IZA Discussion Papers 662, Institute for the Study of Labor (IZA). [Downloadable!]
  6. Joseph Sabia, 2009. "The Effects of Minimum Wage Increases on Retail Employment and Hours: New Evidence from Monthly CPS Data," Journal of Labor Research, Springer, vol. 30(1), pages 75-97, March. [Downloadable!] (restricted)
  7. Orrenius, Pia M. & Zavodny, Madeline, 2008. "The Effect of Minimum Wages on Immigrants’ Employment and Earnings," IZA Discussion Papers 3499, Institute for the Study of Labor (IZA). [Downloadable!]
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