Pooling Multiple Case Studies Using Synthetic Controls: An Application to Minimum Wage Policies

Arindrajit Dube and Ben Zipperer ()
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Ben Zipperer: University of Massachusetts Amherst

No 8944, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We propose a simple, distribution-free method for pooling synthetic control case studies using the mean percentile rank. We also test for heterogeneous treatment effects using the distribution of estimated ranks, which has a known form. We propose a cross-validation based procedure for model selection. Using 29 cases of state minimum wage increases between 1979 and 2013, we find a sizable, positive and statistically significant effect on the average teen wage. We do detect heterogeneity in the wage elasticities, consistent with differential bites in the policy. In contrast, the employment estimates suggest a small constant effect not distinguishable from zero.

Keywords: synthetic controls; program evaluation; heterogeneous treatment effects; minimum wage (search for similar items in EconPapers)
JEL-codes: J23 J38 J88 (search for similar items in EconPapers)
Pages: 60 pages
Date: 2015-03
New Economics Papers: this item is included in nep-ecm and nep-lma
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Citations: View citations in EconPapers (83)

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