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The Effects of Living Wage Laws: Evidence From Failed and Derailed Living Wage Campaigns

  • Scott Adams
  • David Neumark

Living wage campaigns have succeeded in about 100 jurisdictions in the United States, but they have also failed in numerous cities. Some were derailed by state legislative or judicial decisions, and others were voted down or vetoed at the city level. This paper exploits the information provided by these failed and derailed campaigns to estimate the effects of living wage laws. Specifically, these campaigns provide a better control group or counterfactual than do the broader set of all cities without a living wage law for estimating the effects of living wage laws. They also permit separate estimations of the effects of living wage laws and living wage campaigns. The findings indicate that living wage laws-especially those that cover business assistance recipients and those accompanied by similar laws in nearby cities-raise the wages of low-wage workers but also reduce employment among the least-skilled.

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Paper provided by Public Policy Institute of California in its series PPIC Working Papers with number 2004.12.

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Date of creation: Aug 2004
Date of revision:
Handle: RePEc:ppi:ppicwp:2004.12
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  1. Marianne P. Bitler & Jonah B. Gelbach & Hilary W. Hoynes, 2003. "Some Evidence on Race, Welfare Reform, and Household Income," American Economic Review, American Economic Association, vol. 93(2), pages 293-298, May.
  2. Scott Adams & David Neumark, 2005. "Living Wage Effects: New and Improved Evidence," Economic Development Quarterly, , vol. 19(1), pages 80-102, February.
  3. repec:tpr:qjecon:v:119:y:2004:i:1:p:249-275 is not listed on IDEAS
  4. Scott Adams & David Neumark, 2004. "When Do Living Wages Bite?," NBER Working Papers 10561, National Bureau of Economic Research, Inc.
  5. John DiNardo & David S. Lee, 2002. "The Impact of Unionization on Establishment Closure: A Regression Discontinuity Analysis of Representation Elections," NBER Working Papers 8993, National Bureau of Economic Research, Inc.
  6. Gruber, Jonathan, 1994. "The Incidence of Mandated Maternity Benefits," American Economic Review, American Economic Association, vol. 84(3), pages 622-41, June.
  7. David Neumark & Scott Adams, 2000. "Do Living Wage Ordinances Reduce Urban Poverty?," NBER Working Papers 7606, National Bureau of Economic Research, Inc.
  8. Burkhauser, Richard V & Couch, Kenneth A & Wittenburg, David C, 2000. "A Reassessment of the New Economics of the Minimum Wage Literature with Monthly Data from the Current Population Survey," Journal of Labor Economics, University of Chicago Press, vol. 18(4), pages 653-80, October.
  9. Smith, James P & Welch, Finis, 1984. "Affirmative Action and Labor Markets," Journal of Labor Economics, University of Chicago Press, vol. 2(2), pages 269-301, April.
  10. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2002. "How Much Should We Trust Differences-in-Differences Estimates?," NBER Working Papers 8841, National Bureau of Economic Research, Inc.
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