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The Race Between Education, Technology, and the Minimum Wage

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  • Jonathan Vogel

Abstract

What is the effect of the real minimum wage on wages and inequality? I develop a theory that nests the race between education and technology. The theory predicts that the effect of changes in minimum wages is initially small but grows over time. I present empirical evidence of these dynamic effects: the elasticity of real wages grows substantially over a three-year period. I show that minimum wages help rationalize a considerable decline in real wages of low-education workers in the 1980s and play a role in shaping the evolution of the U.S. college premium.

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  • Jonathan Vogel, 2025. "The Race Between Education, Technology, and the Minimum Wage," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 140(3), pages 1857-1899.
    • Handle: RePEc:oup:qjecon:v:140:y:2025:i:3:p:1857-1899.
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    File URL: http://hdl.handle.net/10.1093/qje/qjaf014
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