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Minimum wage increases and individual employment trajectories

Author: Ekaterina JardimMark C LongRobert D PlotnickEmma Van InwegenJacob L VigdorAll authors
Publisher: Cambridge, Mass. : National Bureau of Economic Research, 2018.
Series: Working paper series (National Bureau of Economic Research), no. 25182.
Edition/Format:   eBook : Document : EnglishView all editions and formats
Summary:
Using administrative employment data from the state of Washington, we use short-duration longitudinal panels to study the impact of Seattle's minimum wage ordinance on individuals employed in low-wage jobs immediately before a wage increase. We draw counterfactual observations using nearest-neighbor matching and derive effect estimates by comparing the "treated" cohort to a placebo cohort drawn from earlier data. We  Read more...
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Material Type: Document, Internet resource
Document Type: Internet Resource, Computer File
All Authors / Contributors: Ekaterina Jardim; Mark C Long; Robert D Plotnick; Emma Van Inwegen; Jacob L Vigdor; Hilary Wething; National Bureau of Economic Research,
OCLC Number: 1061148974
Notes: "October 2018"
Description: 1 online resource (47 pages) : illustrations.
Series Title: Working paper series (National Bureau of Economic Research), no. 25182.
Responsibility: Ekaterina Jardim, Mark C. Long, Robert Plotnick, Emma van Inwegen, Jacob Vigdor, Hilary Wething.

Abstract:

Using administrative employment data from the state of Washington, we use short-duration longitudinal panels to study the impact of Seattle's minimum wage ordinance on individuals employed in low-wage jobs immediately before a wage increase. We draw counterfactual observations using nearest-neighbor matching and derive effect estimates by comparing the "treated" cohort to a placebo cohort drawn from earlier data. We attribute significant hourly wage increases and hours reductions to the policy. On net, the minimum wage increase from $9.47 to as much as $13 per hour raised earnings by an average of $8-$12 per week. The entirety of these gains accrued to workers with above-median experience at baseline; less-experienced workers saw no significant change to weekly pay. Approximately one-quarter of the earnings gains can be attributed to experienced workers making up for lost hours in Seattle with work outside the city limits. We associate the minimum wage ordinance with an 8% reduction in job turnover rates as well as a significant reduction in the rate of new entries into the workforce.

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