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State minimum wages and business location: Evidence from a refined border approach

Shawn Rohlin ()

Journal of Urban Economics, 2011, vol. 69, issue 1, 103-117

Abstract: This study examines the effect of state minimum wage changes on new and existing business establishments. It employs a refined border approach in conjunction with other differencing methods to control for unobserved heterogeneous area characteristics. The findings suggest that state minimum wage increases deter new establishments from locating in an area, particularly in industries that rely on low-education workforces, such as the retail and manufacturing industries. However, existing establishments, regardless of industry type, are not found to be adversely affected by minimum wage policy.

Keywords: Minimum; wage; Spatial; differencing; Borders; Business; location (search for similar items in EconPapers)
Date: 2011
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