Employment Effects of the Minimum Wage: Panel Data Evidence from Canadian Provinces

20 Pages Posted: 27 Nov 2017

See all articles by Kathleen Rybczynski

Kathleen Rybczynski

University of Waterloo

Anindya Sen

University of Waterloo

Date Written: January 2018

Abstract

Recent U.S. studies offer conflicting evidence on minimum wage impacts. This paper studies the effects of 185 amendments to minimum wage on employment rates using panel data across Canadian provinces from 1981 to 2011. Ordinary least squares and instrumental variables (IV) estimates imply a 10% increase in minimum wage is associated with a 1%–4% reduction to employment rates for both male and female teens. We also find that an increase in the minimum wage is associated with lower employment of prime‐aged immigrants. Our results are robust to a wide array of IV and the use of controls for spatial heterogeneity.

JEL Classification: J30, J71, J23

Suggested Citation

Rybczynski, Kathleen and Sen, Anindya, Employment Effects of the Minimum Wage: Panel Data Evidence from Canadian Provinces (January 2018). Contemporary Economic Policy, Vol. 36, Issue 1, pp. 116-135, 2018. Available at SSRN: https://ssrn.com/abstract=3076633 or http://dx.doi.org/10.1111/coep.12241

Kathleen Rybczynski (Contact Author)

University of Waterloo

Waterloo, Ontario N2L 3G1
Canada

Anindya Sen

University of Waterloo ( email )

Waterloo, Ontario N2L 3G1
Canada

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