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Employment Effects of Minimum and Subminimum Wages: Reply to Card, Katz and Krueger

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Author Info
David Neumark
William Wascher

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Abstract

In Neumark and Wascher (1992), we present findings supporting the earlier consensus that minimum wages reduce employment for teens and young adults, with elasticities in the range -0.1 to -0.2. In addition, we find that subminimum wages moderate these disemployment effects. Card, Katz and Krueger (1993) criticize numerous aspects of our analysis, and contest our conclusions. This reply presents an assessment of their arguments, as well as additional evidence related to some of the criticisms that they raise. We conclude that the issues raised by Card, et al., upon further examination, do not alter the conclusions from our original paper, and in some cases even reinforce those conclusions.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 4570.

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Date of creation: Dec 1993
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Handle: RePEc:nbr:nberwo:4570

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Find related papers by JEL classification:
J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

Cited by:
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  1. Natalya Y. Shelkova, 2008. "Low-Wage Labor Markets and the Power of Suggestion," Working papers 2008-33, University of Connecticut, Department of Economics, revised Dec 2008. [Downloadable!]
    Other versions:
  2. Mark D. Partridge, Jamie S. Partridge, 1999. "Do Minimum Wage Hikes Raise US Long Term Unemployment? Evidence Using State Minimum Wage Rates," Regional Studies, Taylor and Francis Journals, vol. 33(8), pages 713-726, November. [Downloadable!] (restricted)
  3. Erzo F.P. Luttmer, 2007. "Does the Minimum Wage Cause Inefficient Rationing?," NBER Working Papers 13012, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  4. Mark D Brenner, 2004. "The Economic Impact of Living Wage Ordinances," Working Papers wp80, Political Economy Research Institute, University of Massachusetts at Amherst. [Downloadable!]
  5. Laura Giuliano, . "Minimum wage effects on employment, substitution, and the quality of the teenage labor supply: Evidence from personal data," Working Papers 0723, University of Miami, Department of Economics. [Downloadable!]
  6. David Neumark & William Wascher, 1994. "Minimum Wage Effects and Low-Wage Labor Markets: A Disequilibrium Approach," NBER Working Papers 4617, National Bureau of Economic Research, Inc. [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!]
    Other versions:
  8. Marianne E. Page & Joanne Spetz & Jane Millar, 2000. "Does the Minimum Wage Affect Welfare Caseloads?," JCPR Working Papers 135, Northwestern University/University of Chicago Joint Center for Poverty Research.
  9. Addison, John T. & Blackburn, McKinley L. & Cotti, Chad D., 2008. "The Effect of Minimum Wages on Wages and Employment: County-Level Estimates for the United States," IZA Discussion Papers 3300, Institute for the Study of Labor (IZA). [Downloadable!]
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