Minimum wage effects within Census Based Statistical Areas: A matched pair cross-border analysis

Garrett C. Taylor and James West

Economics Letters, 2023, vol. 229, issue C

Abstract: Using monthly data from major U.S. metropolitan areas that span state borders, we estimate the elasticity of employment with respect to the minimum wage using a difference-in-differences design with continuous treatment in two-digit industries of 71 (Arts, Entertainment and Recreation) and 72 (Accommodation and Food Services). In specifications that control for differences in state sales, personal and corporate income tax rates, we find a negative average causal response on the treated (ACRT) in six-digit industries where we expect large numbers of young, entry-level employees but positive correlations in other industries. Our results illustrate important heterogeneities in minimum wage effects in urban versus rural areas.

Keywords: Minimum wages; Difference-in-differences; Continuous treatment; State tax rates (search for similar items in EconPapers)
JEL-codes: J21 J31 J38 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Working Paper: Minimum Wage Effects Within Census Based Statistical Areas: A Matched Pair Cross-Border Analysis (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:229:y:2023:i:c:s0165176523002458

DOI: 10.1016/j.econlet.2023.111220

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