The authors assess the critique by Neumark, Salas, and Wascher (2014) of minimum wage studies that found small effects on teen employment. Data from 1979 to 2014 contradict NSW; the authors show that ...the disemployment suggested by a model assuming parallel trends across U.S. states mostly reflects differential pre-existing trends. A data-driven LASSO procedure that optimally corrects for state trends produces a small employment elasticity (–0.01). Even a highly sparse model rules out substantial disemployment effects, contrary to NSW’s claim that the authors discard too much information. Synthetic controls do place more weight on nearby states—confirming the value of regional controls—and generate an elasticity of 20.04. A similar elasticity (–0.06) obtains from a design comparing contiguous border counties, which the authors show to be good controls. NSW’s preferred matching estimates mix treatment and control units, obtain poor matches, and find the highest employment declines where the relative minimum wage falls. These findings refute NSW’s key claims.
In a thorough and well-documented study of the American and British experience with minimum wage legislation, Prof. Jerold Waltman describes and analyzes the operation of current minimum wage ...policies and politics in both countries. Where are we and how did we get here? For Britain, he chronicles the events leading up to the enactment of the National Minimum Wage, and then discusses its subsequent evolution. Turning to the United States, he covers the almost moribund but still important federal minimum wage, and then traces developments on the state and local front. After that, he takes up the accomplishments of the living wage movement in each nation. He then assesses whether or not contemporary advocates for heightened minimum wages are laying the groundwork for a rejuvenated welfare state. Are they fashioning a public philosophy that will make the minimum wage once again a central feature of the welfare state, or are they heading down other paths? Providing a context within which to evaluate opposing policy proposals, he also discusses the general aspects of minimum wage policy and examines in detail the history of minimum wages in the two countries.
This book provides in-depth and innovative analysis of the minimum wage in Europe. The authors explore its role and scope within the enlarged EU, and address the question of whether there should be ...harmonization between the individual member states or even a common EU minimum wage. They also examine the impact of the minimum wage at the national level, looking at trends and effects through case studies of specific policy issues and industrial sectors.
The authors revisit the long-running minimum wage–employment debate to assess new studies claiming that estimates produced by the panel data approach commonly used in recent minimum wage research are ...flawed by that approach's failure to account for spatial heterogeneity. The new studies use research designs intended to control for this heterogeneity and conclude that minimum wages in the United States have not reduced employment. The authors explore the ability of the new research designs to isolate reliable identifying information, and they test the designs' untested assumptions about the construction of better control groups. Their analysis reveals problems with the new research designs. Moreover, using methods that let the data identify the appropriate control groups, their results reaffirm the evidence of disemployment effects, with teen employment elasticities near -0.15. This evidence, they conclude, still shows that minimum wages pose a tradeoff of higher wages for some against job losses for others.
Researchers’ interest in monopsony has increased in recent years. This article reviews the accumulating evidence that employers have considerable monopsony power. It summarizes the application of ...this idea to explaining the impact of minimum wages and immigration, in anti-trust, and in understanding how to model the determinants of earnings in matched employer–employee data sets and the implications for inequality and the labor share.
When adjusted to reflect inflation, the federal minimum wage is almost 40percent lower than it was in 1970. The Biden Administration tried and failed to legislatively raise the minimum wage, and ...political deadlock will continue to kill legislative change. The shareholder proposal, a nonbinding recommendation to management that shareholders can submit for a vote at a public corporations annual meeting, presents a path for improving the wages of many workers in the absence of federal legislation. This Note analyzes the best approach to crafting a shareholder proposal on minimum wage that will prompt an effective increase in the minimum wages paid to workers. It evaluates the barriers to success and concludes that the right team of actors can overcome the barriers to raise the minimum wages paid to workers at large corporations through shareholder proposals.
•Economic theory predicts that the employment effects of the minimum wage should vary with the composition of affected occupations and industries.•A $15 federal minimum wage in the United States ...would affect a far broader set of occupations and industries than prior increases.•Thus, regardless of one’s views about the employment effects of prior increases, we cannot use past experience to directly extrapolate the effects of a $15 minimum.•The current frontier of historical experience is a federal minimum wage between $9 and $11.
Many economists and policymakers implicitly assume that “previous, modest increases in the minimum wage” are informative about the effects of a $15 minimum. Economic theory predicts that the employment effects of the minimum wage should vary with the composition of affected occupations and industries. I find that a $15 minimum would affect a far broader set of occupations and industries than prior increases, calling into question whether we can extrapolate from past experience with the minimum wage. I find that the frontier of historical experience is a federal minimum between $9 and $11.
Minimum Wages Neumark, David; Wascher, William L
08/2010, Letnik:
1
eBook, Book
Minimum wages exist in more than one hundred countries, both industrialized and developing. The United States passed a federal minimum wage law in 1938 and has increased the minimum wage and its ...coverage at irregular intervals ever since; in addition, as of the beginning of 2008, thirty-two states and the District of Columbia had established a minimum wage higher than the federal level, and numerous other local jurisdictions had in place "living wage" laws. Over the years, the minimum wage has been popular with the public, controversial in the political arena, and the subject of vigorous debate among economists over its costs and benefits. In this book, David Neumark and William Wascher offer a comprehensive overview of the evidence on the economic effects of minimum wages. Synthesizing nearly two decades of their own research and reviewing other research that touches on the same questions, Neumark and Wascher discuss the effects of minimum wages on employment and hours, the acquisition of skills, the wage and income distributions, longer-term labor market outcomes, prices, and the aggregate economy. Arguing that the usual focus on employment effects is too limiting, they present a broader, empirically based inquiry that will better inform policymakers about the costs and benefits of the minimum wage. Based on their comprehensive reading of the evidence, Neumark and Wascher argue that minimum wages do not achieve the main goals set forth by their supporters. They reduce employment opportunities for less-skilled workers and tend to reduce their earnings; they are not an effective means of reducing poverty; and they appear to have adverse longer-term effects on wages and earnings, in part by reducing the acquisition of human capital. The authors argue that policymakers should instead look for other tools to raise the wages of low-skill workers and to provide poor families with an acceptable standard of living.
This research is based on the application of wages below the minimum wage for businesses that meet the criteria for micro and small businesses. As it is known that the provisions of the district and ...city minimum wages are a form of safety net for the economic life of Indonesian workers. However, often a common problem for micro and small businesses is that they cannot meet the minimum wage requirements because the economic capacity of their own businesses is different from that of large businesses. Through the Employment Creation Act, the government finally made changes to the labor cluster by providing special rules for micro and small businesses in terms of providing wages below the minimum wage. The problems that will be studied in this research are regarding the requirements to be able to provide wages below the minimum wage provisions and how to provide wages under the minimum wage provisions. The method used by the author in this study is a normative juridical research. The results of the research are an explanation of the conditions for businesses that can pay their workers' wages below the minimum wage, how to make a Collective Agreement so that they can pay wages below the minimum wage.
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