New Estimates of the Effects of Minimum Wages in the U.S. Retail Trade Sector

John Addison, McKinley Blackburn () and Chad Cotti

No 3597, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper examines the impact of minimum wages on earnings and employment in selected branches of the retail-trade sector, 1990-2005, using county-level data on employment and a panel regression framework that allows for county-specific trends in sectoral outcomes. We focus on particular subsectors within retail trade that are identified as particularly low-wage. We find little evidence of disemployment effects once we allow for geographic-specific trends. Rather, in many sectors the evidence suggests modest (but robust) positive employment effects. One explanation we consider for these ‘perverse’ effects is that minimum wages may have significant influences on product demand shifts.

Keywords: right-to-work states; minimum wages; wages and employment; county-level data; unions; spatial trends; border county analysis (search for similar items in EconPapers)
JEL-codes: J23 J38 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2008-07
New Economics Papers: this item is included in nep-lab and nep-ltv
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Published - published in: Labour Economics, 2009, 16 (4), 397-408

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