Empirical Research on Large Minimum-Wage Increases: Does It Have a Future?
5 Pages Posted: 11 May 2014 Last revised: 4 Sep 2014
Date Written: May 8, 2014
An empirical challenge seems to have fractured what was a near-consensus among economists that minimum-wage increases make it more difficult for low-skilled workers to find or retain employment. Yet there is a persisting consensus among economists that any such increases which are 'large' — typically defined in terms of the magnitude of the changes in the wage floor and the ratio between the wage floor and the median wage — would indeed have the disemployment effect. If this persisting consensus is also subject to empirical challenge, such a challenge would surely incorporate analysis of any large minimum-wage increases that have already occurred. But oddly, and quite mistakenly, more than one leading researcher has casually claimed that no such events have ever occurred. Here, to aid future researchers, several episodes involving large increases are identified and some relevant literature is catalogued.
Keywords: Minimum wages, sociology of economics, David Neumark, Arindrajit Dube, Puerto Rico, Commonwealth of the Northern Mariana Islands, American Samoa
JEL Classification: A14, J38, N32
Suggested Citation: Suggested Citation