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http://hdl.handle.net/10419/34794
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| Title: | | The effect of minimum wages on wages and employment: county-level estimates for the United States  |
| Authors: | | Addison, John T. Blackburn, McKinley L. Cotti, Chad D. |
| Issue Date: | | 2008 |
| Series/Report no.: | | IZA Discussion Papers 3300 |
| Abstract: | | We use county-level data on employment and earnings in the restaurant-and-bar sector to evaluate the impact of minimum wage changes on low-wage labor markets. Our empirical approach is similar to the literature that has used state-level panel data to estimate minimum-wage impacts, with the difference that we focus on a particular sector rather than demographic group. Our estimated models are consistent with a simple competitive model of the restaurant-and-bar labor market in which supply-and-demand factors affect both the equilibrium outcome and the probability that a minimum wage will be binding in any given time period. Our evidence does not suggest that minimum wages reduce employment in the overall restaurant-and-bar sector, after controls for trends in sector employment at the county level are incorporated in the model. Employment in this sector appears to exhibit a downward long-term trend in states that have increased their minimum wages relative to states that have not, thereby predisposing fixed-effects estimates towards finding negative employment effects. |
| Subjects: | | Minimum wages wages and employment county-level data spatial trends |
| JEL: | | J23 |
| Document Type: | | Working Paper |
| Appears in Collections: | | IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)
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