Employment-Based Health Insurance and the Minimum Wage

Laura Bucila

No 812, Working Papers from College of the Holy Cross, Department of Economics

Abstract: This paper provides new estimates of the effects of increased federal and state minimum wages on the employment-based health insurance coverage of low-wage workers. I use March Current Population Surveys collected from IPUMS, for 1988 to 2005. Previous studies have found no significant evidence that increased minimum wages reduce fringe benefit receipt (Beeson Royalty 2000; Simon and Kaestner 2003). In contrast to these studies, I use a difference-in-difference approach and I define treatment groups as being individuals in the lowest 1 and 2 deciles of the hourly wage distribution. Little evidence was found for the federal minimum wage increase of 1990-91, but estimates of the effect of the 1996-97 increase suggest a small negative impact for younger workers and workers in smaller firms. At the state level, I find more suggestive results of a negative impact of the minimum wage increases. New Jersey (1992) and Massachusetts (2000-2001) exhibit negative effects of being in the treatment group on the probability of having employment-based health insurance for most of the specifications, while the results in Oregon (1991) and Connecticut (2000-2001) are more sensitive to the specification. The results suggest that being in the treatment group makes individuals 3 to 4 percentage points less likely to be policyholders of employment-based health insurance compared to the control group.

Keywords: Minimum Wage; Fringe Benefits (search for similar items in EconPapers)
JEL-codes: J32 J33 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2008-09
New Economics Papers: this item is included in nep-hea, nep-ias and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://hcapps.holycross.edu/hcs/RePEc/hcx/HC0812- ... ranceMinimumWage.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hcx:wpaper:0812

Access Statistics for this paper

More papers in Working Papers from College of the Holy Cross, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Victor Matheson ().