The economic impact of living wage ordinances

Brenner, Mark D.

doi:10.4324/9780203629451.ch13

Cited by 7 publications

(7 citation statements)

References 15 publications

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“…An Economic Policy Institute study in 1998 concluded that "after four years in force, the Baltimore living wage increase did not result in any discernible job loss" ([2], p. 10). In fact, research by Card and Krueger corroborate studies by Neumark and Wascher that living wage or "higher minimum wage mandates do not behave in the manner predicted by competitive models and that average firm employment does not decline but may in fact increase slightly following minimum wage increases" ( [9], p. 6). The unemployed often fill positions that the formerly underemployed no longer need to make ends meet.…”

Section: Economic Implications Of a Living Wagesupporting

confidence: 67%

“…If production costs increase one to two percent, companies may decide to absorb expenses rather than risk losing business ( [9], p. 24). Likewise, some effects of raising prices are minimal.…”

Section: Economic Implications Of a Living Wagementioning

confidence: 99%

“…9-10). Because living wage ordinances prevent government contract bidders from undercutting wages or benefits, service quality becomes a key differentiator among competitors ( [9], pp. 21-23).…”

Section: Economic Implications Of a Living Wagementioning

confidence: 99%

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The Economic and Ethical Implications of Living Wages

Konigsburg

2017

Religions

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Although rhetoric about wages and jobs often emphasizes the effects of globalization, questions remain as to whether United States workers are paid adequately to sustain a reasonable standard of living. One solution is to implement a living wage, which is accurate and specific to a local economy but more computationally complex than a one-size-fits-all minimum wage. When considered economically, a living wage has the potential to increase business and production costs as well as lower profits and cause job loss. From ethical viewpoints articulated in Catholic social thought, sustainable wages enhance human dignity by supporting human agency, encouraging creativity, and permitting contributions to the common good. This article explores whether the positive ethical outcomes of implementing a living wage outweigh any possibly negative, unintended economic results.

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Section: Economic Implications Of a Living Wagesupporting

confidence: 67%

Section: Economic Implications Of a Living Wagementioning

confidence: 99%

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The Economic and Ethical Implications of Living Wages

Konigsburg

2017

Religions

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“…But this literature has also made clear the limitations of these measures in terms of affecting large numbers of the working poor. Indeed, most studies of both proposed and enacted living wage ordinances find that these measures affect a very small number of private sector firms in a given locale, and that the benefits of higher wages are concentrated among a small fraction of the overall workforce within any given municipality (Brenner 2004).…”

Section: The Effects Of Living Wages On Firm Behavior: Theory and Eximentioning

confidence: 99%

The Economic Impact of the Boston Living Wage Ordinance*

Brenner¹

2004

Industrial Relations

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This paper presents one of the first quantitative assessments of the effect living wage laws have had on firms covered by their mandate. Applying difference‐in‐difference estimation methods to survey data from Boston, Massachusetts, I find little evidence of reduced employment or hours worked, following living wage implementation. Instead, there is strong evidence that firms actually shifted from part‐time towards full‐time staffing as a result of Boston's living wage law. Estimates also reveal a substantial degree of wage compression within firms who raised wages. Finding no evidence of reduced employment or hours, this paper uses qualitative survey data to examine other ways in which firms may have adjusted to higher wages. I find some evidence that covered firms have taken lower profits as a way to adjust to the Boston law.

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“…In addition, while compensation strategy is important on its own, it is also closely related to other choices the firm makes. Decisions on compensation strategy can affect the firm as a whole and influence other decisions (Balkin & Gomez-Mejia, 1987; Brenner, 2004). Faced with higher wages, for example, a firm may compensate with raising prices, increasing sales, changing operational techniques, or raising productivity.…”

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confidence: 99%

The Effect of Cost of Living on Employee Wages in the Hospitality Industry

Sturman

Ukhov

Park

2016

Cornell Hospitality Quarterly

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This study examines the effect of cost of living (COL) on employee wages in the hotel industry. Although prior research clearly indicates that COL and wages are positively related, there is a lack of research explicitly considering the specific nature of the relationship between COL and wages, and potential moderators to the relationship. Using a dataset containing information on 97 jobs over 67 cities, our study shows that while there is a positive effect of COL on wages, the adjustment is not equal in magnitude to the difference that the COL levels would indicate. Furthermore, the effect of COL decreases as the average wage for the given job increases. We also show differences in COL's effects for full-service versus limited-service hotels. We illustrate the implications of our findings by showing predicted wage rates for four jobs in five different cities, at both full-service and limit-service hotels. The study has implications for research, particularly for future work on COL and compensation. The findings also have important implications for practice, and may be particularly useful when managers need to set pay levels when local market data are unavailable.

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The economic impact of living wage ordinances

Cited by 7 publications

References 15 publications

The Economic and Ethical Implications of Living Wages

The Economic and Ethical Implications of Living Wages

The Economic Impact of the Boston Living Wage Ordinance*

The Effect of Cost of Living on Employee Wages in the Hospitality Industry

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