Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/89954
Authors: 
Allegretto, Sylvia
Dube, Arindrajit
Reich, Michael
Zipperer, Ben
Year of Publication: 
2013
Series/Report no.: 
IZA Discussion Paper 7638
Abstract: 
We assess alternative research designs for minimum wage studies. States in the U.S. with larger minimum wage increases differ from others in business cycle severity, increased inequality and polarization, political economy, and regional distribution. The resulting time-varying heterogeneity biases the canonical two-way fixed effects estimator. We consider alternatives including border discontinuity designs, dynamic panel data models, and the synthetic control estimator. Results from four datasets and six approaches all suggest employment effects are small. Covariates are more similar in neighboring counties, and the synthetic control estimator assigns greater weights to nearby donors. These findings also support using local area controls.
Subjects: 
minimum wage
youth employment
border discontinuity
policy evaluation
JEL: 
J08
J23
J38
J42
J63
J64
Document Type: 
Working Paper

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