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