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Minimum Wages and the Labor Market Effects of Immigration

Anthony Edo () and Hillel Rapoport

Working Papers from CEPII research center

Abstract: This paper exploits the non-linearity in the level of minimum wages across U.S. States created by the coexistence of federal and state regulations to investigate how the prevalence of minimum wages affects the labor market impact of immigration. We find that the effects of immigration on the wages and employment of native workers within a given state-skill cell are more negative in U.S. States with low minimum wages (i.e., where the federal minimum wage is binding). The results are robust to instrumenting immigration and state effective minimum wages, and to implementing a difference-in-differences approach comparing U.S. States where effective minimum wages are fully determined by the federal minimum wage over the whole period considered (2000-2013) to U.S. States where this is never the case. This paper thus underlines the important role played by minimum wages in mitigating any adverse labor market effects of low-skill immigration.

Keywords: immigration; minimum wages; labor markets (search for similar items in EconPapers)
JEL-codes: F22 J61 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab and nep-mig
Date: 2017-07
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Citations: View citations in EconPapers (5) Track citations by RSS feed

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Related works:
Working Paper: Minimum Wages and the Labor Market Effects of Immigration (2018) Downloads
Working Paper: Minimum Wages and the Labor Market Effects of Immigration (2017) Downloads
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