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We've Got You Covered: Establishment-Level Evidence on California's Fast-Food Minimum Wage

Author

Listed:
  • Vitor C. Melo
  • David Neumark
  • Liam Sigaud
  • Gary A. Wagner

Abstract

We study the employment effects of California’s $20 fast-food minimum wage. Evaluating this policy poses two challenges in commonly used aggregate datasets: coverage is based on 60-establishment chain-size threshold that cannot be identified; and there is measurement error in the industry codes used to identify fast-food restaurants. We address these challenges using establishment-level data. We find evidence of negative employment effects, but they are concentrated among small chains, among which the policy also slowed entry and increased exit. Thus, the primary effect of the fast-food minimum wage was to disadvantage small chains, albeit with modest overall employment effects thus far.

Suggested Citation

  • Vitor C. Melo & David Neumark & Liam Sigaud & Gary A. Wagner, 2026. "We've Got You Covered: Establishment-Level Evidence on California's Fast-Food Minimum Wage," NBER Working Papers 35749, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:35749
    Note: LE LS PE
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    More about this item

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J4 - Labor and Demographic Economics - - Particular Labor Markets

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