scholarly journals Evidence on Employment Effects of Minimum Wages and Subminimum Wage Provisions From Panel Data on State Minimum Wage Laws

10.3386/w3859 ◽  
1991 ◽  
Author(s):  
David Neumark ◽  
William Wascher
Keyword(s):  
Panel Data ◽  
Minimum Wage ◽  
Minimum Wages ◽  
Employment Effects

Employment Effects of Minimum and Subminimum Wages: Panel Data on State Minimum Wage Laws

ILR Review ◽  
1992 ◽  
Vol 46 (1) ◽  
pp. 55-81 ◽  
Author(s):  
David Neumark ◽  
William Wascher
Keyword(s):  
Time Series ◽  
Young Adults ◽  
Panel Data ◽  
Minimum Wage ◽  
State Legislatures ◽  
Minimum Wages ◽  
Economic Conditions ◽  
Employment Effects ◽  
Time Series Studies

Using panel data on state minimum wage laws and economic conditions for the years 1973–89, the authors reevaluate existing evidence on the effects of a minimum wage on employment. Their estimates indicate that a 10% increase in the minimum wage causes a decline of 1–2% in employment among teenagers and a decline of 1.5–2% in employment for young adults, similar to the ranges suggested by earlier time-series studies. The authors also find evidence that youth subminimum wage provisions enacted by state legislatures moderate the disemployment effects of minimum wages on teenagers.

Reply to “Credible Research Designs for Minimum Wage Studies”

ILR Review ◽  
2017 ◽  
Vol 70 (3) ◽  
pp. 593-609 ◽  
Author(s):  
David Neumark ◽  
William Wascher
Keyword(s):  
Panel Data ◽  
Labor Markets ◽  
Minimum Wage ◽  
State Level ◽  
Minimum Wages ◽  
Negative Effects ◽  
Employment Effects ◽  
Research Designs ◽  
Wage Employment

The authors make three points in this reply to the article by Allegretto, Dube, Reich, and Zipperer (ADRZ 2017). First, ADRZ shed no new light on the sensitivity of estimated minimum wage employment effects to the treatment of trends in state-level panel data, and they make some arguments in this context that are misleading or simply wrong. Second, the key issue ADRZ emphasize—using “close controls” to account for shocks that are correlated with minimum wage changes—does not generate large differences in findings, and ADRZ do not address evidence from Neumark, Salas, and Wascher (NSW 2014a) that questions the validity of the close controls used in Allegretto, Dube, and Reich’s (ADR 2011) and Dube, Lester, and Reich’s (DLR 2010) work. Third, ADRZ ignore or dismiss a growing number of studies that address in various ways the same issue of potential correlations between minimum wages and shocks to low-skill labor markets that ADRZ argue generate spurious evidence of disemployment effects, yet often find rather large negative effects of minimum wages on low-skilled employment.

scholarly journals The Minimum Wage Affects Them All: Evidence on Employment Spillovers in the Roofing Sector

2013 ◽  
Vol 14 (3) ◽  
pp. 282-315 ◽  
Author(s):  
Bodo Aretz ◽  
Terry Gregory ◽  
Melanie Arntz
Keyword(s):  
Minimum Wage ◽  
Scale Effects ◽  
Minimum Wages ◽  
Wage Distribution ◽  
Employment Effects ◽  
Eastern Germany

Abstract This study contributes to the sparse literature on employment spillovers of minimum wages. We exploit the minimum wage introduction and subsequent increases in the German roofing sector that gave rise to an internationally unprecedented hard bite of a minimum wage. We look at the chances of remaining employed in the roofing sector for workers with and without a binding minimum wage and use the plumbing sector that is not subject to a minimum wage as a suitable benchmark sector. By estimating the counterfactual wage that plumbers would receive in the roofing sector given their characteristics, we are able to identify employment effects along the entire wage distribution. The results indicate that the chances for roofers to remain employed in the sector in eastern Germany deteriorated along the entire wage distribution. Such employment spillovers to workers without a binding minimum wage may result from scale effects and/or capital-labour substitution.

scholarly journals The Econometrics and Economics of the Employment Effects of Minimum Wages: Getting from Known Unknowns to Known Knowns

2019 ◽  
Vol 20 (3) ◽  
pp. 293-329 ◽  
Author(s):  
David Neumark
Keyword(s):  
United States ◽  
Minimum Wage ◽  
Past Research ◽  
The United States ◽  
Minimum Wages ◽  
Definitive Answer ◽  
Employment Effects ◽  
Conflicting Evidence ◽  
Known Unknowns ◽  
Wage Increases

Abstract I discuss the econometrics and the economics of past research on the effects of minimum wages on employment in the United States. My intent is to try to identify key questions raised in the recent literature, and some from the earlier literature, which I think hold the most promise for understanding the conflicting evidence and arriving at a more definitive answer about the employment effects of minimum wages. My secondary goal is to discuss how we can narrow the range of uncertainty about the likely effects of the large minimum wage increases becoming more prevalent in the United States. I discuss some insights from both theory and past evidence that may be informative about the effects of high minimum wages, and try to emphasize what research can be done now and in the near future to provide useful evidence to policymakers on the results of the coming high minimum wage experiment, whether in the United States or in other countries.

scholarly journals Pengaruh Upah Minimum Provinsi, Investasi dan PDRB Terhadap Penyerapan Tenaga Kerja di Indonesia

2020 ◽  
Vol 4 (1) ◽  
pp. 42-55
Author(s):  
Sapriansah Ali Nur Iksan ◽  
Zainal Arifin ◽  
Muhammad Sri Wahyudi Suliswanto
Keyword(s):  
Time Series ◽  
Panel Data ◽  
Minimum Wage ◽  
Cross Section ◽  
Fixed Effect ◽  
Minimum Wages ◽  
West Java ◽  
Insignificant Effect ◽  
Average Contribution ◽  
Effect Test

This study aims to describe the contribution and examine the effect of provincial minimum wages, investment and GRDP on labor absorption in Indonesia. The data used in this study uses panel data, namely a combination of time series and cross section, in this study using 34 provinces in Indonesia in 2013-2017. This study uses the Fixed Effect test. The results showed that the highest average contribution of labor absorption was in the province of East Java, investment was in the province of West Java, the provincial GDP and minimum wages were in the province of DKI Jakarta. Meanwhile, the estimation results show that the provincial minimum wage variable has a positive and significant effect on labor absorption, the investment variable has a negative and insignificant effect on labor absorption, while the GRDP variable has a positive and significant effect on labor absorption in Indonesia.

scholarly journals MINIMUM WAGE IMPLICATIONS AND POVERTY NUMBERS EAST JAVA PROVINCE

2018 ◽  
Vol 16 (2) ◽  
pp. 121
Author(s):  
Novi Primita Sari
Keyword(s):  
Regression Analysis ◽  
Panel Data ◽  
Minimum Wage ◽  
Poverty Line ◽  
Poverty Rate ◽  
Minimum Wages ◽  
Poor People ◽  
Unemployment Rates ◽  
City Regions

An area is said to be advanced if the number of people living below the poverty line is getting smaller. But the problem of poverty is not an easy matter to solve, many factors that lead to faster growth every year. This study aims to analyze the implications of GRDP, the determination of regional minimum wages (UMR) and unemployment rates for the number of poor people in East Java Province. The method used in this study is a regression analysis with panel data covering, Regency and City GRDP data throughout the East Java Province, 2015 to 2016 UMR and unemployment in all Regency and City regions in East Java Province in the same two-year period . The results of the analysis of this study can be concluded that in the last two years the GRDP variables did not have an influence on poverty, but two variables, namely unemployment and regional minimum wages had an influence on the poverty rate in East Java Province. With the R square value obtained is 0.999483 which means that the model in this study is able to explain the phenomenon of 99.98 percent.

Monopsony power and the demand for low-skilled workers

2021 ◽  
pp. 103530462110424
Author(s):  
Arnd Kölling
Keyword(s):  
Labour Market ◽  
Minimum Wage ◽  
Minimum Wages ◽  
Labour Demand ◽  
Skilled Workers ◽  
Jel Codes ◽  
Employment Effects ◽  
Monopsony Power

This study analyses firms’ labour demand when employers have at least some monopsony power. It is argued that without taking into account (quasi-)monopsonistic structures of the labour market, wrong predictions are made about the effects of minimum wages. Using switching fractional panel probit regressions with German establishment data, I find that slightly more than 80% of establishments exercise some degree of monopsony power in their demand for low-skilled workers. The outcome suggests that a 1% increase in payments for low-skilled workers would, in these firms, increase employment for this group by 1.12%, while firms without monopsony power reduce the number of low-skilled, by about 1.63% for the same increase in remuneration. The study can probably also be used to explain the limited employment effects of the introduction of a statutory minimum wage in Germany and thus leads to a better understanding of the labour market for low-skilled workers. JEL Codes: J23, J42, C23, D24

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