Analyzing the Effects of Minimum Wage with Location Quotients
7 Pages Posted: 17 Jul 2017 Last revised: 19 Jul 2017
Date Written: July 5, 2017
Minimum wage has been a topic of interest to both economists and politicians especially since the David Card and Alan Krueger minimum wage study in the 1990's that called into question the standard economic theory on minimum wage effects on employment. The Card-Krueger study spawned the 'New Minimum Wage Debate' and lead to the creation of many new papers on the subject. This paper explores the minimum wage debate using a novel method: location quotients. Using a diff-in-diff analysis, I compare location quotients in Johnson County, Iowa and Story County, Iowa after a minimum wage raise in Johnson County in 2016. I find no statistically significant change in the location quotient.
Keywords: minimum wage, location quotients
JEL Classification: J38, J23
Suggested Citation: Suggested Citation