Absence of conflict of interest.
Citation
Cahn, Y. (2022). Essays in labor economics and econometrics [Doctoral dissertation, Emory University]. Emory Theses and Dissertations. https://etd.library.emory.edu/concern/etds/b8515p66n?locale=en
Highlights
- The study's objective was to examine the impact of minimum wage increases on employment and earnings.
- Using data from the Current Population Survey Merged Outgoing Rotation Group from 2003 to 2019, the author conducted a nonexperimental study using a statistical model to estimate the impacts of minimum wage increases on hours worked and wages.
- The study suggested that minimum wage increases were associated with higher employment and higher wages.
- The quality of causal evidence presented in this report is low because the authors did not ensure that the groups being compared were similar before the intervention. This means we are not confident that the estimated effects are attributable to minimum wage increases; other factors are likely to have contributed.
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Intervention Examined
Minimum Wage Increases
Features of the Intervention
Minimum wage increases primarily seek to help workers with low wages. Some studies suggest that raising the minimum wage decreases wage inequality. However, there is limited research on how minimum wage increases affect employment and specifically the number of hours worked.
Features of the Study
The author conducted a nonexperimental study to estimate the impacts of minimum wage increases on employment and earnings, using data from the Current Population Survey Merged Outgoing Rotation Group from 2003 to 2019. The study sample included respondents aged 18 to 64 but excluded self-employed individuals. The author used a statistical model to estimate the impacts of minimum wage increases on hours worked and wages for men and women. The author used Heckman-type selection models to account for possible employment effects. In addition to state and year fixed effects, the author included statistical controls for union membership, marital status, race, part-time employment, education, work experience, industry, occupation, and metropolitan statistical area.
Findings
Employment
- The study suggested that a one dollar increase in a state's minimum wage was associated with 1.43 additional hours worked per week for men and 0.64 additional hours worked per week for women.
Earnings
- The study suggested that a one dollar increase in a state's minimum wage was associated with a 9% increase in wages for both men and women.
Considerations for Interpreting the Findings
The author included statistical controls for race and sex as required by the protocol. However, the author did not include statistical controls for age and pre-intervention measures of the outcomes. Since the author did not account for preexisting differences between the groups before intervention participation, these preexisting differences between the groups—and not the intervention—could explain the observed differences in outcomes.
Causal Evidence Rating
The quality of causal evidence presented in this report is low because the author did not ensure that the groups being compared were similar before the intervention. This means we are not confident that the estimated effects are attributable to minimum wage increases; other factors are likely to have contributed.