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Minimum Wage Analysis Using a Pre-Committed Research Design: Evidence through 2018

Author

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  • Clemens, Jeffrey

    (University of California, San Diego)

  • Strain, Michael R.

    (American Enterprise Institute for Public Policy Research)

Abstract

This paper presents results from the fourth year of a multi-year, pre-committed research design for analyzing recent minimum wage changes. Using ACS and CPS data through 2018, we find that relatively large minimum wage increases reduced employment among low-skilled individuals by roughly 2.5 percentage points. The effects of smaller statutory increases and inflation-indexed increases vary across data sets and specifications, but are generally not distinguishable from zero. The relationship between minimum wage increases and employment is quite strongly negative in states that began enacting substantial increases between 2013 and 2015. In states that began enacting increases later in the economic expansion, estimates are more variable and tend towards zero.

Suggested Citation

  • Clemens, Jeffrey & Strain, Michael R., 2020. "Minimum Wage Analysis Using a Pre-Committed Research Design: Evidence through 2018," IZA Discussion Papers 13286, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp13286
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    References listed on IDEAS

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    1. Garret Christensen & Edward Miguel, 2018. "Transparency, Reproducibility, and the Credibility of Economics Research," Journal of Economic Literature, American Economic Association, vol. 56(3), pages 920-980, September.
    2. Clemens, Jeffrey & Strain, Michael R., 2019. "Minimum Wage Analysis Using a Pre-Committed Research Design: Evidence through 2017," IZA Discussion Papers 12388, Institute of Labor Economics (IZA).
    3. Daniel Aaronson & Eric French & Isaac Sorkin & Ted To, 2018. "Industry Dynamics And The Minimum Wage: A Putty†Clay Approach," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 59(1), pages 51-84, February.
    4. Clemens, Jeffrey & Wither, Michael, 2019. "The minimum wage and the Great Recession: Evidence of effects on the employment and income trajectories of low-skilled workers," Journal of Public Economics, Elsevier, vol. 170(C), pages 53-67.
    5. Jeffrey Clemens & Michael R. Strain, 2017. "Estimating the Employment Effects of Recent Minimum Wage Changes: Early Evidence, an Interpretative Framework, and a Pre-Commitment to Future Analysis," NBER Working Papers 23084, National Bureau of Economic Research, Inc.
    6. Jeffrey Clemens & Michael R. Strain, 2018. "The Short‐Run Employment Effects Of Recent Minimum Wage Changes: Evidence From The American Community Survey," Contemporary Economic Policy, Western Economic Association International, vol. 36(4), pages 711-722, October.
    7. Clemens, Jeffrey & Hobbs, Duncan & Strain, Michael R., 2018. "A Database on the Passage and Enactment of Recent State Minimum Wage Increases," IZA Discussion Papers 11748, Institute of Labor Economics (IZA).
    8. Hoffman Saul D., 2014. "Employment Effects of the 2009 Minimum Wage Increase: New Evidence from State-Based Comparisons of Workers by Skill Level," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 14(3), pages 1-27, July.
    9. Neumark, David & Yen, Maysen, 2020. "Effects of Recent Minimum Wage Policies in California and Nationwide: Initial Results from a Pre-specified Analysis Plan," IZA Discussion Papers 13062, Institute of Labor Economics (IZA).
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    Cited by:

    1. Clemens, Jeffrey & Strain, Michael R., 2021. "The Heterogeneous Effects of Large and Small Minimum Wage Changes: Evidence over the Short and Medium Run Using a Pre-analysis Plan," IZA Discussion Papers 14747, Institute of Labor Economics (IZA).
    2. Michael R. Strain, 2021. "An Argument Against The $15 Minimum Wage," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 40(4), pages 1289-1297, September.

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    More about this item

    Keywords

    minimum wages; employment; pre-commitment;
    All these keywords.

    JEL classification:

    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

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