Minimum Wage Effects in the Longer Run

David Neumark and Olena Nizalova

No 50626, Working Papers from University of California-Irvine, Department of Economics

Abstract: Exposure to minimum wages at young ages may lead to longer-run effects. Among the possible adverse longer-run effects are decreased labor market experience and accumulation of tenure, diminished education and training, and lower current labor supply because of lower wages. Beneficial longer-run effects could arise if minimum wages increase skill acquisition, or if initial wage increases are long-lasting. We estimate the longer-run effects of minimum wages by using information on the minimum wage history that workers have faced since potentially entering the labor market. The evidence indicates that even as individuals reach their late 20's, they earn less and perhaps work less the longer they were exposed to a higher minimum wage at younger ages. The adverse longer-run effects of facing high minimum wages at young ages are stronger for blacks. From a policy perspective, these longer-run effects of minimum wages are likely more significant than the contemporaneous effects of minimum wages on youths that are the focus of most research and policy debate.

JEL-codes: J22 J23 J38 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2006-02
New Economics Papers: this item is included in nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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https://www.economics.uci.edu/files/docs/workingpapers/2005-06/Neumark-26.pdf (application/pdf)

Related works:
Journal Article: Minimum Wage Effects in the Longer Run (2007)
Working Paper: Minimum Wage Effects in the Longer Run (2004)
Working Paper: Minimum Wage Effects in the Longer Run (2004)
Working Paper: Minimum Wage Effects in the Longer Run (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:irv:wpaper:050626

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