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Minimum Wage Increases Under Straightened Circumstances

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Author Info

  • Addison, John T.

    ()
    (University of South Carolina)

  • Blackburn, McKinley L.

    ()
    (University of South Carolina)

  • Cotti, Chad

    ()
    (University of Wisconsin, Oshkosh)

Abstract

Do apparently large minimum wage increases in an environment of recession produce clearer evidence of disemployment effects than is typically observed in the new minimum wage literature? This paper augments the sparse literature on the most recent increases in the U.S. minimum wage, using three different data sets and the two main estimation strategies for handling geographically-disparate trends. The evidence is generally unsupportive of negative employment effects, still less of a 'recessionary multiplier.' Minimum wage workers seem to be concentrated in sectors of the economy for which the labor demand response to wage mandates is minimal.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6036.

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Length: 44 pages
Date of creation: Oct 2011
Date of revision:
Handle: RePEc:iza:izadps:dp6036

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Related research

Keywords: geographically-disparate employment trends; minimum wages; earnings; low-wage sectors; recession; disemployment;

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References

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  1. David Neumark & William Wascher, 2007. "Does a Higher Minimum Wage Enhance the Effectiveness of The Earned Income Tax Credit?," NBER Working Papers 12915, National Bureau of Economic Research, Inc.
  2. David Card, 1992. "Using regional variation in wages to measure the effects of the federal minimum wage," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 46(1), pages 22-37, October.
  3. David Neumark & William Wascher, 2006. "Minimum Wages and Employment: A Review of Evidence from the New Minimum Wage Research," Working Papers 060708, University of California-Irvine, Department of Economics, revised Jan 2007.
  4. Addison, John T. & Blackburn, McKinley L. & Cotti, Chad D., 2009. "Do minimum wages raise employment? Evidence from the U.S. retail-trade sector," Labour Economics, Elsevier, vol. 16(4), pages 397-408, August.
  5. Dube, Andrajit & Lester, T. William & Reich, Michael, 2010. "Minimum Wage Effects Across State Borders: Estimates Using Contiguous Counties," Institute for Research on Labor and Employment, Working Paper Series, Institute of Industrial Relations, UC Berkeley qt86w5m90m, Institute of Industrial Relations, UC Berkeley.
  6. Allegretto, Sylvia & Dube, Arindrajit & Reich, Michael, 2010. "Do Minimum Wages Really Reduce Teen Employment? Accounting for Heterogeneity and Selectivity in State Panel Data," Institute for Research on Labor and Employment, Working Paper Series, Institute of Industrial Relations, UC Berkeley qt7jq2q3j8, Institute of Industrial Relations, UC Berkeley.
  7. John T. Addison & McKinley L. Blackburn & Chad D. Cotti, 2008. "The Effect of Minimum Wages on Labor Market Outcomes: County-Level Estimates from the Restaurant-and-Bar Sector," Working Paper Series, The Rimini Centre for Economic Analysis 02-08, The Rimini Centre for Economic Analysis, revised Jan 2008.
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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Minimum Wage Increases Under Straightened Circumstances
    by maximorossi in NEP-LTV blog on 2011-11-03 12:13:26
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Cited by:
  1. Allegretto, Sylvia & Dube, Arindrajit & Reich, Michael & Zipperer, Ben, 2013. "Credible Research Designs for Minimum Wage Studies," Institute for Research on Labor and Employment, Working Paper Series, Institute of Industrial Relations, UC Berkeley qt3hk7s3fw, Institute of Industrial Relations, UC Berkeley.
  2. Hirsch, Barry & Kaufman, Bruce E. & Zelenska, Tetyana, 2011. "Minimum Wage Channels of Adjustment," IZA Discussion Papers 6132, Institute for the Study of Labor (IZA).

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