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Quantile estimates of counterfactual distribution shifts and the effect of minimum wage increases on the wage distribution
Author(s) -
Stewart Mark B.
Publication year - 2012
Publication title -
journal of the royal statistical society: series a (statistics in society)
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.103
H-Index - 84
eISSN - 1467-985X
pISSN - 0964-1998
DOI - 10.1111/j.1467-985x.2011.01007.x
Subject(s) - counterfactual thinking , quantile , econometrics , spillover effect , percentile , economics , estimator , distribution (mathematics) , wage , statistics , mathematics , labour economics , microeconomics , psychology , social psychology , mathematical analysis
Summary. The paper presents a method for estimating the effects of a policy change on an outcome distribution that uses a comparator quantile rather than a control group and provides methods for estimating the variances of the estimators. The empirical analysis presents estimates of ‘spillover’ effects of increases in the UK minimum wage, i.e. effects on the wages of those who are already above the minimum, under various counterfactual distribution shift assumptions. Evidence is presented against a simple scaled counterfactual. On the basis of the proposed counterfactual estimated spillover effects are small and in most cases do not reach above the fifth percentile.