33rd Annual Student Research Conference
Minimum Wage: Effects and Implications
Garrett L. Fiegenbaum* and Kyle Hidalgo
Dr. David Gillette, Faculty Mentor
This research investigates macroeconomic effects of minimum wage laws. We investigate the presence of wage spillovers for higher-wage earners, the magnitude of disemployment effects that follow minimum wage increases, and the public choice implications of minimum wage laws. To analyze disemployment effects, our linear regression model uses a modified version of Okun’s Law to describe the relationship between change in unemployment and change in minimum wages. Our analysis of national and state level data indicates that when the ratio of minimum wage to median income is small, minimum wages have negligible disemployment effects. As the ratio increases, disemployment responses become increasingly strong. We interpret these findings and their policy implications.
Keywords: Okun's Law, Minimum Wage, Public Choice, Disemployment, Spillover
Topic(s):Economics
Presentation Type: Oral Presentation
Session: TBA
Location: TBA
Time: TBA