IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Does the minimum wage affect welfare caseloads?

  • Marianne E. Page

    (University of California, Davis)

  • Joanne Spetz

    (University of California, San Francisco)

  • Jane Millar

    (University of California, Davis)

Although minimum wages are advocated as a policy that will help the poor, few studies have examined their effect on poor families. This paper uses variation in minimum wages across states and over time to estimate the impact of minimum wage legislation on welfare caseloads. We find that the elasticity of the welfare caseload with respect to the minimum wage is between 0.1 and 0.2, but this estimate is sensitive to the sample period and assumptions about state trends. We tentatively conclude that higher minimum wages increase welfare dependence; however, more research is warranted.© 2005 by the Association for Public Policy Analysis and Management

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://hdl.handle.net/10.1002/pam.20090
File Function: Link to full text; subscription required
Download Restriction: no

Article provided by John Wiley & Sons, Ltd. in its journal Journal of Policy Analysis and Management.

Volume (Year): 24 (2005)
Issue (Month): 2 ()
Pages: 273-295

as
in new window

Handle: RePEc:wly:jpamgt:v:24:y:2005:i:2:p:273-295
Contact details of provider: Web page: http://www3.interscience.wiley.com/journal/34787/home

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Janet Currie & Bruce C. Fallick, 1996. "The Minimum Wage and the Employment of Youth Evidence from the NLSY," Journal of Human Resources, University of Wisconsin Press, vol. 31(2), pages 404-428.
  2. Lang, Kevin & Kahn, Shulamit, 1998. "The effect of minimum-wage laws on the distribution of employment: theory and evidence," Journal of Public Economics, Elsevier, vol. 69(1), pages 67-82, July.
  3. Neumark, David & Wascher, William, 2001. "Using The EITC to Help Poor Families: New Evidence and a Comparison with the Minimum Wage," National Tax Journal, National Tax Association, vol. 54(n. 2), pages 281-318, June.
  4. Borjas, George J & Hilton, Lynette, 1996. "Immigration and the Welfare State: Immigrant Participation in Means-Tested Entitlement Programs," The Quarterly Journal of Economics, MIT Press, vol. 111(2), pages 575-604, May.
  5. 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.
  6. Eissa, Nada & Liebman, Jeffrey B, 1996. "Labor Supply Response to the Earned Income Tax Credit," The Quarterly Journal of Economics, MIT Press, vol. 111(2), pages 605-37, May.
  7. V. Joseph Hotz & John Karl Scholz, 2001. "The Earned Income Tax Credit," NBER Working Papers 8078, National Bureau of Economic Research, Inc.
  8. Lawrence F. Katz & Alan B. Krueger, 1992. "The Effect of the Minimum Wage on the Fast Food Industry," NBER Working Papers 3997, National Bureau of Economic Research, Inc.
  9. Stacy Dickert & Scott Houser & John Karl Scholz, 1995. "The Earned Income Tax Credit and Transfer Programs: A Study of Labor Market and Program Participation," NBER Chapters, in: Tax Policy and the Economy, Volume 9, pages 1-50 National Bureau of Economic Research, Inc.
  10. Jacob Alex Klerman & Steven J. Haider, 2004. "A Stock-Flow Analysis of the Welfare Caseload," Journal of Human Resources, University of Wisconsin Press, vol. 39(4).
  11. David N. Figlio & James P. Ziliak, 1999. "Welfare Reform, the Business Cycle, and the Decline in AFDC Caseloads," JCPR Working Papers 77, Northwestern University/University of Chicago Joint Center for Poverty Research.
  12. Rebecca M. Blank, 2000. "What Causes Public Assistance Caseloads to Grow?," JCPR Working Papers 18, Northwestern University/University of Chicago Joint Center for Poverty Research.
  13. Michael L. Wachter & Choongsoo Kim, 1982. "Time Series Changes in Youth Joblessness," NBER Chapters, in: The Youth Labor Market Problem: Its Nature, Causes, and Consequences, pages 155-198 National Bureau of Economic Research, Inc.
  14. Aaron Yelowitz, 1995. "The Medicaid Notch, Labor Supply and Welfare Participation: Evidence from Eligibility Expansions," UCLA Economics Working Papers 738, UCLA Department of Economics.
  15. 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.
  16. David Neumark & Mark Schweitzer & William Wascher, 2004. "The effects of minimum wages on the distribution of family incomes: a nonparametric analysis," Working Paper 0412, Federal Reserve Bank of Cleveland.
  17. Rebecca M. Blank & Patricia Ruggles, 1996. "When Do Women Use Aid to Families with Dependent Children and Food Stamps? The Dynamics of Eligibility Versus Participation," Journal of Human Resources, University of Wisconsin Press, vol. 31(1), pages 57-89.
  18. David Neumark & William Wascher, 1992. "Employment Effects of Minimum and Subminimum Wages: Panel Data on State Minimum Wage Laws," ILR Review, Cornell University, ILR School, vol. 46(1), pages 55-81, October.
  19. David Neumark & William Wascher, 2002. "Do Minimum Wages Fight Poverty?," Economic Inquiry, Western Economic Association International, vol. 40(3), pages 315-333, July.
  20. Whitney K. Newey & Kenneth D. West, 1986. "A Simple, Positive Semi-Definite, Heteroskedasticity and AutocorrelationConsistent Covariance Matrix," NBER Technical Working Papers 0055, National Bureau of Economic Research, Inc.
  21. 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.
  22. Olivier Jean Blanchard & Lawrence F. Katz, 1992. "Regional Evolutions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 23(1), pages 1-76.
  23. David Neumark & William Wascher, 1993. "Employment Effects of Minimum and Subminimum Wages: Reply to Card, Katz and Krueger," NBER Working Papers 4570, National Bureau of Economic Research, Inc.
  24. Moore, Thomas Gale, 1971. "The Effect of Minimum Wages on Teenage Unemployment Rates," Journal of Political Economy, University of Chicago Press, vol. 79(4), pages 897-902, July-Aug..
  25. John T. Addison & McKinley L. Blackburn, 1999. "Minimum wages and poverty," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 52(3), pages 393-409, April.
  26. H. W. Hoynes, . "Local Labor Markets and Welfare Spells: Do Demand Conditions Matter?," Institute for Research on Poverty Discussion Papers 1104-96, University of Wisconsin Institute for Research on Poverty.
  27. Alison J. Wellington, 1991. "Effects of the Minimum Wage on the Employment Status of Youths: An Update," Journal of Human Resources, University of Wisconsin Press, vol. 26(1), pages 27-46.
  28. R. V. Burkhauser & K. A. Couch & A. J. Glenn, . "Public policies for the working poor: The earned income tax credit versus minimum wage legislation," Institute for Research on Poverty Discussion Papers 1074-95, University of Wisconsin Institute for Research on Poverty.
  29. Charles Brown & Curtis Gilroy & Andrew Kohen, 1981. "Time-Series Evidence of the Effect of the Minimum Wage on Youth Employment and Unemployment," NBER Working Papers 0790, National Bureau of Economic Research, Inc.
  30. David Card, 1992. "Using Regional Variation in Wages to Measure the Effects of the Federal Minimum Wage," Working Papers 680, Princeton University, Department of Economics, Industrial Relations Section..
  31. David Card & Lawrence F. Katz & Alan B. Krueger, 1994. "Comment on "Employment effects of minimum and subminimum wages: Panel data on state minimum wage laws," by David Neumark and William Wascher (46:1, Oct. 1992, p. 55)," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 47(3), pages 487-512, April.
  32. David Card, 1992. "Using Regional Variation in Wages to Measure the Effects of the Federal Minimum Wage," ILR Review, Cornell University, ILR School, vol. 46(1), pages 22-37, October.
  33. Michael L. Wachter & Choongsoo Kim, 1979. "Time Series Changes in Youth Joblessness," NBER Working Papers 0384, National Bureau of Economic Research, Inc.
  34. Mark D. Turner, 1999. "The Effects of Higher Minimum Wages on Welfare Recipiency," JCPR Working Papers 95, Northwestern University/University of Chicago Joint Center for Poverty Research.
  35. Moffitt, Robert, 1992. "Incentive Effects of the U.S. Welfare System: A Review," Journal of Economic Literature, American Economic Association, vol. 30(1), pages 1-61, March.
  36. David Card & Lawrence Katz & Alan Krueger, 1993. "Comment on David Neumark and William Wascher, 'Employment Effects of Minimum and Subminimum Wages: Panel Data on State Minimum Wage Laws'," Working Papers 695, Princeton University, Department of Economics, Industrial Relations Section..
  37. Blank, Rebecca M., 1989. "Analyzing the length of welfare spells," Journal of Public Economics, Elsevier, vol. 39(3), pages 245-273, August.
  38. David Neumark & William Wascher, 1992. "Employment effects of minimum and subminimum wages: Panel data on state minimum wage laws," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 46(1), pages 55-81, October.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:wly:jpamgt:v:24:y:2005:i:2:p:273-295. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing)

or (Christopher F. Baum)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.