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THE SHORT‐RUN EMPLOYMENT EFFECTS OF RECENT MINIMUM WAGE CHANGES: EVIDENCE FROM THE AMERICAN COMMUNITY SURVEY
Author(s) -
Clemens Jeffrey,
Strain Michael R.
Publication year - 2018
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/coep.12279
Subject(s) - minimum wage , economics , inflation (cosmology) , wage , percentage point , labour economics , indexation , current population survey , sample (material) , demographic economics , population , point (geometry) , monetary economics , monetary policy , chemistry , physics , demography , finance , chromatography , sociology , theoretical physics , geometry , mathematics
This paper presents early evidence on the employment effects of state minimum wage increases enacted between January 2013 and January 2015. As of 2015, we estimate that relatively large minimum wage increases (defined as those exceeding $1) reduced employment among low‐skilled population groups by just over 1 percentage point. Smaller minimum wage increases, as well as increases linked to inflation indexation provisions, appear to have had much smaller (and possibly positive) effects on employment over our sample period. The estimates thus raise the potential importance of nonlinearities in the minimum wage's effects, which are consistent with standard models of the labor market. ( JEL H11, J08, J23)