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Effects of the minimum wage on employment dynamics

Author: Jonathan Meer; Jeremy West; National Bureau of Economic Research.
Publisher: Cambridge, Mass. : National Bureau of Economic Research, 2013.
Series: Working paper series (National Bureau of Economic Research), no. 19262.
Edition/Format:   eBook : Document : EnglishView all editions and formats
Summary:
The voluminous literature on minimum wages offers little consensus on the extent to which a wage floor impacts employment. For both theoretical and econometric reasons, we argue that the effect of the minimum wage should be more apparent in new employment growth than in employment levels. In addition, we conduct a simulation showing that the common practice of including state-specific time trends will attenuate the  Read more...
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Material Type: Document, Internet resource
Document Type: Internet Resource, Computer File
All Authors / Contributors: Jonathan Meer; Jeremy West; National Bureau of Economic Research.
OCLC Number: 854994969
Notes: Title from http://www.nber.org/papers/19262 viewed August 5, 2013.
"July 2013."
Description: 1 online resource (39 pages) : illustrations.
Series Title: Working paper series (National Bureau of Economic Research), no. 19262.
Responsibility: Jonathan Meer, Jeremy West.

Abstract:

The voluminous literature on minimum wages offers little consensus on the extent to which a wage floor impacts employment. For both theoretical and econometric reasons, we argue that the effect of the minimum wage should be more apparent in new employment growth than in employment levels. In addition, we conduct a simulation showing that the common practice of including state-specific time trends will attenuate the measured effects of the minimum wage on employment if the true effect is in fact on the rate of job growth. Using a long state-year panel on the population of private-sector employers in the United States, we find that the minimum wage reduces net job growth, primarily through its effect on job creation by expanding establishments.

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