Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/202907
Authors: 
Cooper, Daniel
Luengo-Prado, Maria José
Parker, Jonathan A.
Year of Publication: 
2017
Series/Report no.: 
Working Papers 17-8
Abstract: 
This paper examines the effect of minimum wage changes on local aggregate inflation and consumption growth. The paper utilizes variation in state-level minimum wages across locations and finds that minimum wage increases have a relatively modest effect on both city-level inflation and spending growth over the years following the change. The most noticeable effects are for food consumed at home and away from home - industries that typically employ a large share of low-wage and minimum-wage workers. Interestingly, consumers adjust their real food consumption when minimum wages rise, suggesting that some workers benefit from minimum wage changes.
Subjects: 
minimum wage increases
prices
consumption
local aggregate effects
JEL: 
E21
E31
E64
Document Type: 
Working Paper
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