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We Just Created More Than 1,000 Synthetic Controls To Study California's $20 Fast Food Minimum Wage

Author

Listed:
  • Jeffrey Clemens
  • Olivia Edwards
  • Jonathan Meer
  • Joshua D. Nguyen

Abstract

Synthetic control methods hold the promise of identifying a credible counterfactual by closely reproducing pretreatment outcome paths. Their reliability, however, depends in part on how effectively they constrain researchers’ less-visible degrees of freedom. We explore these methods’ sensitivity by constructing 1440 plausibly defensible specifications to estimate the employment effect of California’s $20 fast-food minimum wage. While over 96 percent of the estimated employment effects are negative, the range is vast, illustrating that synthetic control methods are sensitive to specification choice. Estimates from simpler and far more transparent difference-in-differences methods lie near the centers of the comparable distributions of synthetic control estimates.

Suggested Citation

  • Jeffrey Clemens & Olivia Edwards & Jonathan Meer & Joshua D. Nguyen, 2026. "We Just Created More Than 1,000 Synthetic Controls To Study California's $20 Fast Food Minimum Wage," NBER Working Papers 35931, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:35931
    Note: LS PE
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    More about this item

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

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