The effects of living wage laws on low-wage workers and low-income families: What do we know now?

Neumark, David; Thompson, Matthew D.; Koyle, Leslie

doi:10.1186/2193-9004-1-11

Cited by 11 publications

(14 citation statements)

References 23 publications

(18 reference statements)

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“…A sizable proportion of those studies cannot identify significant effects on the reduction of poverty (Vedder and Gallaway, 2002;Neumark and Wascher, 2002;Burkhauser and Sabia, 2007;Sabia, 2008;Sabia and Burkhauser, 2010;Sabia and Nielsen, 2013). Other studies find moderate, yet statistically significant reductions for the incidence (Addison and Blackburn, 1999;Morgan and Kickham, 2001;Stevans and Sessions, 2001;Gundersen and Ziliak, 2004;DeFina, 2008;Sen et al, 2011) and depth of poverty (Dube, 2018) in the U.S. Neumark et al (2012) identify a slight poverty-reducing effect of city-wide living wage laws.…”

Section: Literaturementioning

confidence: 98%

Does the German Minimum Wage Help Low Income Households?: Evidence from Observed Outcomes and the Simulation of Potential Effects

Backhaus

Müller

2019

SSRN Journal

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Does the federal minimum wage in Germany introduced in 2015 improve the income situation of low income households and reduce in-work poverty? Previous literature on its distributional impact was either focused on earnings and hourly wages (e.g. Caliendo et al., 2017), or is based on ex-ante simulations (e.g. Müller and Steiner, 2013). This paper provides systematic descriptive ex-post evidence on the distributional implications of the German minimum wage on wages and disposable household incomes as well as some underlying mechanisms. We analyze various measures of hourly wage and disposable household income distributions, both, for the group of affected individuals and the entire population. Most approaches identify individuals affected by the minimum wage based on pre-reform wages ignoring large job fluctuations and measurement error at the bottom of the wage distribution. In contrast, we define the group of affected by people's relative position in the wage distribution in each respective year. Full compliance scenarios are simulated at the actual and markedly higher minimum wage levels to interpret observational outcomes and gauge the redistributive potential of the minimum wage. We find evidence for wage increases at the bottom of the wage distribution. Effects on wage inequality are limited because of non-compliance, difficulties in hourly wage measurement in certain types employment, and unequal wage growth across the distribution. Confirming previous simulation evidence the minimum wage proves to be an ineffective tool for the redistribution of disposable household incomes. Overall inequality has even increased slightly as incomes of poor households grew below average. Affected households are not found primarily at the bottom, but rather in the middle of the income distribution. Working hours of individuals and earnings of other members in households affected by the minimum wage decreased. Benefit withdrawal is of minor importance as welfare transfers and top-up benefits were only marginally reduced by the minimum wage.

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Section: Literaturementioning

confidence: 98%

Does the German Minimum Wage Help Low Income Households?: Evidence from Observed Outcomes and the Simulation of Potential Effects

Backhaus

Müller

2019

SSRN Journal

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“…Living wages typically imposed wage floors much higher than minimum wages, but limited to much narrower sets of workers (city contractors, and firm receiving financial assistance from cities). For details and recent evidence, see Neumark et al (2012). 37 Neumark and Wascher (2008, Chapter 4) review the broader evidence.…”

Section: Discussionmentioning

confidence: 99%

The Employment Effects of Minimum Wages: Some Questions We Need to Answer

Neumark¹

2018

Oxford Research Encyclopedia of Economics and Finance

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The literature on the employment effects of minimum wages is about a century old, and includes hundreds of studies. Yet the debate among researchers about the employment effects of minimum wages remains intense and unsettled. Questions have arisen in the past research that, if answered, may prove most useful in making sense of the conflicting evidence. However, additional questions should be considered to better inform the policy debate, in particular in the context of the very high minimum wages coming on line in the United States, about which past research is quite uninformative.

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“…Living wages typically imposed wage floors much higher than minimum wages but limited to much narrower sets of workers (city contractors, and firm receiving financial assistance from cities). For details and recent evidence, see Neumark et al (2012).…”

Section: V3 Labor-labor Substitutionmentioning

confidence: 99%

The Econometrics and Economics of the Employment Effects of Minimum Wages: Getting from Known Unknowns to Known Knowns

Neumark

2019

German Economic Review

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I discuss the econometrics and the economics of past research on the effects of minimum wages on employment in the United States. My intent is to try to identify key questions raised in the recent literature, and some from the earlier literature, which I think hold the most promise for understanding the conflicting evidence and arriving at a more definitive answer about the employment effects of minimum wages. My secondary goal is to discuss how we can narrow the range of uncertainty about the likely effects of the large minimum wage increases becoming more prevalent in the United States. I discuss some insights from both theory and past evidence that may be informative about the effects of high minimum wages, and try to emphasize what research can be done now and in the near future to provide useful evidence to policymakers on the results of the coming high minimum wage experiment, whether in the United States or in other countries.

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The effects of living wage laws on low-wage workers and low-income families: What do we know now?

Cited by 11 publications

References 23 publications

Does the German Minimum Wage Help Low Income Households?: Evidence from Observed Outcomes and the Simulation of Potential Effects

Does the German Minimum Wage Help Low Income Households?: Evidence from Observed Outcomes and the Simulation of Potential Effects

The Employment Effects of Minimum Wages: Some Questions We Need to Answer

The Econometrics and Economics of the Employment Effects of Minimum Wages: Getting from Known Unknowns to Known Knowns

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