Using Regional Variation in Wages to Measure the Effects of the Federal Minimum Wage
The imposition of a national wage standard sets up a useful natural experiment in which the "treatment effect" varies across states depending on the fraction of workers earning less than the new minimum. I use this idea to evaluate the effect of the April 1990 increase in the Federal minimum wage on teenage wages, employment, and school enrollment. Interstate variation in teenage wages was high at the end of the 1980s, in part because 16 states had enacted state-specific minimums above the prevailing Federal rate. Comparisons of grouped and individual state data confirm that the rise in the minimum wage significantly increased teenage wages. There is no evidence of corresponding losses in teenage employment, or changes in teenage school enrollment.
|Date of creation:||Apr 1992|
|Date of revision:|
|Publication status:||published as David Card, 1992. "Using regional variation in wages to measure the effects of the federal minimum wage," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 46(1), pages 22-37, October.|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
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- Lawrence F. Katz & Alan B. Krueger, 1992.
"The Effect of the Minimum Wage on the Fast-Food Industry,"
Cornell University, ILR School, vol. 46(1), pages 6-21, October.
- Katz, L.F. & Krueger, A.B., 1992. "The Effect of the Minimum Wage on the Fast Food Industry," Harvard Institute of Economic Research Working Papers 1584, Harvard - Institute of Economic Research.
- 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.
- 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.
- repec:pri:indrel:298 is not listed on IDEAS
- Jean Baldwin Grossman, 1983. "The Impact of the Minimum Wage on Other Wages," Journal of Human Resources, University of Wisconsin Press, vol. 18(3), pages 359-378.
- Lawrence Katz & Alan Krueger, 1992. "The Effect of the Minimum Wage on the Fast Food Industry," Working Papers 678, Princeton University, Department of Economics, Industrial Relations Section..
- Richard B. Freeman & Wayne B. Gray & Casey Ichniowski, 1981. "Low-Cost Student Labor: The Use and Effects of the Subminimum Wage Provisions for Full-time Students," NBER Working Papers 0765, National Bureau of Economic Research, Inc.
- repec:fth:prinin:298 is not listed on IDEAS
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