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The Minimum Wage and Regional Wage Structure: Implications for Income Distribution

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  • Oren M. Levin-Waldman

Abstract

When the minimum wage was first enacted in 1938, the fiercest opposition came from the South, where wages were considerably lower that in the industrial North. Today, that opposition is found to emanate from states that have right-to-work laws (regardless of location). Using census data from the Integrated Public Use Microdata Series (IPUMS) for the years 1940 to 1990, this paper looks at workers earning around the minimum wage by region and industry. It shows that, controlling for education and industry type, wages tend to be depressed more in states with right-to-work legislation than in high union density states. These effects on the wage structure have implications for the distribution of income.

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  • Oren M. Levin-Waldman, 1999. "The Minimum Wage and Regional Wage Structure: Implications for Income Distribution," Economics Working Paper Archive wp_267, Levy Economics Institute.
  • Handle: RePEc:lev:wrkpap:wp_267
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    References listed on IDEAS

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    1. Nicole M. Fortin & Thomas Lemieux, 1997. "Institutional Changes and Rising Wage Inequality: Is There a Linkage?," Journal of Economic Perspectives, American Economic Association, pages 75-96.
    2. Gordon, Robert J, 1995. "Is There a Trade-off between Unemployment and Productivity Growth?," CEPR Discussion Papers 1159, C.E.P.R. Discussion Papers.
    3. Coelho, Philip R P & Ghali, Moheb A, 1971. "The End of the North-South Wage Differential," American Economic Review, American Economic Association, pages 932-937.
    4. John Kennan, 1995. "The Elusive Effects of Minimum Wages," Journal of Economic Literature, American Economic Association, pages 1950-1965.
    5. Brown, Charles & Gilroy, Curtis & Kohen, Andrew, 1982. "The Effect of the Minimum Wage on Employment and Unemployment," Journal of Economic Literature, American Economic Association, pages 487-528.
    6. Alida Castillo Freeman & Richard B. Freeman, 1991. "Minimum Wages in Puerto Rico: Textbook Case of a Wage Floor?," NBER Working Papers 3759, National Bureau of Economic Research, Inc.
    7. John Kennan, 1995. "The Elusive Effects of Minimum Wages," Journal of Economic Literature, American Economic Association, pages 1950-1965.
    8. Richard V. Burkhauser & T. Aldrich Finegan, 1989. "The minimum wage and the poor: The end of a relationship," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 8(1), pages 53-71.
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