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A $15 federal minimum wage is outside historical experience

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  • Fillmore, Ian

Abstract

Many economists and policymakers implicitly assume that “previous, modest increases in the minimum wage” are informative about the effects of a $15 minimum. Economic theory predicts that the employment effects of the minimum wage should vary with the composition of affected occupations and industries. I find that a $15 minimum would affect a far broader set of occupations and industries than prior increases, calling into question whether we can extrapolate from past experience with the minimum wage. I find that the frontier of historical experience is a federal minimum between $9 and $11.

Suggested Citation

  • Fillmore, Ian, 2022. "A $15 federal minimum wage is outside historical experience," Research in Economics, Elsevier, vol. 76(1), pages 84-92.
    • Handle: RePEc:eee:reecon:v:76:y:2022:i:1:p:84-92
    DOI: 10.1016/j.rie.2022.03.002
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    References listed on IDEAS

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    1. Congressional Budget Office, 2019. "The Effects on Employment and Family Income of Increasing the Federal Minimum Wage," Reports 55410, Congressional Budget Office.
    2. Jeffrey Clemens, 2021. "How Do Firms Respond to Minimum Wage Increases? Understanding the Relevance of Non-employment Margins," Journal of Economic Perspectives, American Economic Association, vol. 35(1), pages 51-72, Winter.
    3. Jeffrey Clemens & Michael R. Strain, 2021. "The Heterogeneous Effects of Large and Small Minimum Wage Changes: Evidence over the Short and Medium Run Using a Pre-Analysis Plan," NBER Working Papers 29264, National Bureau of Economic Research, Inc.
    4. Neumark, David & Wascher, William L., 2007. "Minimum Wages and Employment," Foundations and Trends(R) in Microeconomics, now publishers, vol. 3(1–2), pages 1-182, March.
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    6. Jeffrey Clemens & Michael R. Strain, 2020. "Implications of schedule irregularity as a minimum wage response margin," Applied Economics Letters, Taylor & Francis Journals, vol. 27(20), pages 1691-1694, November.
    7. Paul Wolfson & Dale Belman, 2019. "15 Years of Research on US Employment and the Minimum Wage," LABOUR, CEIS, vol. 33(4), pages 488-506, December.
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    More about this item

    Keywords

    Minimum wage; Labor demand;

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J80 - Labor and Demographic Economics - - Labor Standards - - - General

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