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Minimum Wage Effects in the Longer Run

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  • David Neumark
  • Olena Nizalova

Abstract

Exposure to minimum wages at young ages could lead to adverse longer-run effects via decreased labor market experience and tenure, and diminished education and training, while beneficial longer-run effects could arise if minimum wages increase skill acquisition. Evidence suggests that as individuals reach their late 20s, they earn less the longer they were exposed to a higher minimum wage at younger ages, and the adverse longer-run effects are stronger for blacks. If there are such longer-run effects of minimum wages, they are likely more significant than the contemporaneous effects on youths that are the focus of research and policy debate.

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Bibliographic Info

Article provided by University of Wisconsin Press in its journal Journal of Human Resources.

Volume (Year): 42 (2007)
Issue (Month): 2 ()
Pages:

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Handle: RePEc:uwp:jhriss:v:42:y:2007:i2:p435-452

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Web page: http://jhr.uwpress.org/

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References

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  1. David Neumark & William Wascher, 1995. "The Effects of Minimum Wages on Teenage Employment and Enrollment: Evidence from Matched CPS Surveys," NBER Working Papers 5092, National Bureau of Economic Research, Inc.
  2. David Fairris & Roberto Pedace, . "The Impact of Minimum Wages on Job Training: An Empirical Exploration with Establishment Data," Claremont Colleges Working Papers 2000-36, Claremont Colleges.
  3. Ruhm, Christopher J, 1991. "Are Workers Permanently Scarred by Job Displacements?," American Economic Review, American Economic Association, vol. 81(1), pages 319-24, March.
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  5. Daron Acemoglu & Steve Pischke, 1999. "Minimum Wages and On-the-Job Training," Working papers 99-25, Massachusetts Institute of Technology (MIT), Department of Economics.
  6. David Neumark & William L. Wascher, 2008. "Minimum Wages," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262141027.
  7. Ragan, James F, Jr, 1977. "Minimum Wages and the Youth Labor Market," The Review of Economics and Statistics, MIT Press, vol. 59(2), pages 129-36, May.
  8. Edward M. Gramlich, 1976. "Impact of Minimum Wages on Other Wages, Employment, and Family Incomes," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 7(2), pages 409-462.
  9. Behrman, Jere R & Sickles, Robin C & Taubman, Paul, 1983. "The Impact of Minimum Wages on the Distributions of Earnings for Major Race-Sex Groups: A Dynamic Analysis," American Economic Review, American Economic Association, vol. 73(4), pages 766-78, September.
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  11. Brown, Charles, 1999. "Minimum wages, employment, and the distribution of income," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 32, pages 2101-2163 Elsevier.
  12. Grogger, Jeff, 1998. "Market Wages and Youth Crime," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 756-91, October.
  13. Brown, Charles & Gilroy, Curtis & Kohen, Andrew, 1982. "The Effect of the Minimum Wage on Employment and Unemployment," Journal of Economic Literature, American Economic Association, vol. 20(2), pages 487-528, June.
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  18. Neumark, David & Wascher, William, 2001. "Minimum Wages and Training Revisited," Journal of Labor Economics, University of Chicago Press, vol. 19(3), pages 563-95, July.
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  23. Thomas R. Michl, 2000. "Can Rescheduling Explain the New Jersey Minimum Wage Studies?," Eastern Economic Journal, Eastern Economic Association, vol. 26(3), pages 265-276, Summer.
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  26. Neumark, David & Wascher, William, 2003. "Minimum wages and skill acquisition: another look at schooling effects," Economics of Education Review, Elsevier, vol. 22(1), pages 1-10, February.
  27. Baker, Michael & Benjamin, Dwayne & Stanger, Shuchita, 1999. "The Highs and Lows of the Minimum Wage Effect: A Time-Series Cross-Section Study of the Canadian Law," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 318-50, April.
  28. Burkhauser, Richard V & Couch, Kenneth A & Wittenburg, David C, 2000. "A Reassessment of the New Economics of the Minimum Wage Literature with Monthly Data from the Current Population Survey," Journal of Labor Economics, University of Chicago Press, vol. 18(4), pages 653-80, October.
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  30. David Neumark & DMark Schweitzer & DaWilliam Wascher, 2004. "Minimum Wage Effects throughout the Wage Distribution," Journal of Human Resources, University of Wisconsin Press, vol. 39(2).
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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Minimum wages and the young
    by chris dillow in Stumbling and Mumbling on 2007-03-19 12:49:35
  2. Youth unemployment
    by Eric Crampton in Offsetting Behaviour on 2010-05-06 02:39:00
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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Cited by:
  1. Leigh, Andrew, 2008. "Estimating the impact of gubernatorial partisanship on policy settings and economic outcomes: A regression discontinuity approach," European Journal of Political Economy, Elsevier, vol. 24(1), pages 256-268, March.
  2. Steven J. Davis & Luis Rivera-Batiz, 2005. "The Climate for Business Development and Employment Growth in Puerto Rico," NBER Working Papers 11679, National Bureau of Economic Research, Inc.
  3. Mo, Pak Hung, 2011. "Minimum Wage Legislation and Economic Growth: Channels and Effects," MPRA Paper 35820, University Library of Munich, Germany.
  4. Gorry, Aspen, 2010. "Minimum Wages and Youth Employment," MPRA Paper 25296, University Library of Munich, Germany.
  5. Oguzhan C. Dincer & Peter J. Lambert, 2006. "Taking care of your own: Ethnic and religious heterogeneity and income inequality," University of Oregon Economics Department Working Papers 2006-9, University of Oregon Economics Department.
  6. Aspen Gorry, 2008. "Labor Market Connections, Minimum Wages, and Youth Employment," 2008 Meeting Papers 794, Society for Economic Dynamics.
  7. Maria J. Hanratty, 2006. "Has the Food Stamp program become more accessible? Impacts of recent changes in reporting requirements and asset eligibility limits," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 25(3), pages 603-621.
  8. Jones, Melanie K. & Jones, Richard J. & Murphy, Philip D. & Sloane, Peter J., 2005. "The Dynamics of the National Minimum Wage: Transitions Between Different Labour Market States," IZA Discussion Papers 1690, Institute for the Study of Labor (IZA).
  9. Zsófia L. Bárány, 2011. "The Minimum Wage and Inequality - The Effects of Education and Technology," CEP Discussion Papers dp1076, Centre for Economic Performance, LSE.
  10. Cardoso, Ana Rute, 2009. "Long-Term Impact of Youth Minimum Wages: Evidence from Two Decades of Individual Longitudinal Data," IZA Discussion Papers 4236, Institute for the Study of Labor (IZA).
  11. J. O’Roark & William Wood, 2011. "Determinants of congressional minimum wage support: the role of economic education," Public Choice, Springer, vol. 147(1), pages 209-225, April.

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