Modern Difference-in-Differences, Same Old Answer: What Event-Study Estimates Really Tell Us About the Effects of Minimum Wages on Jobs

David Neumark and Antonio Rodriguez-Lopez

No 26229, RFBerlin Discussion Paper Series from ROCKWOOL Foundation Berlin (RFBerlin)

Abstract: Two prominent publications in the recent minimum wage literature argue that estimation of the employment effects of minimum wages should use "clean" event-study designs, and that doing so leads to the conclusion that minimum wages have very limited, if any, effects on employment. We explore the use of event-study designs in this context, using the event-study stacked design of Cengiz, Dube, Lindner and Zipperer (2019a) and the related local projections difference-in-differences approach in Dube and Lindner (2024), along with their same data sources and period coverage. We generally find negative and significant employment effects of minimum wages in the United States, both overall and-more strongly-in the restaurant industry. The null results in these two papers are fragile and depend critically on a number of choices regarding variables, events, sample definitions, and weighting; they are not attributable to using an event-study design.

Keywords: Minimum wage; employment; difference-in-differences; event studies (search for similar items in EconPapers)
JEL-codes: C01 J23 J38 (search for similar items in EconPapers)
Date: 2026-09
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