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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

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File URL: http://hdl.handle.net/10.1002/pam.20090
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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

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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

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