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The effects of minimum wages over the business cycle: the Great Recession

Author

Listed:
  • Oudom Hean
  • Nanxin Deng

Abstract

Purpose - This paper examines disemployment effects of minimum wages during the period 2002–2010. Design/methodology/approach - The authors employ the discontinuity design. Findings - The authors find that minimum wages had a significant negative impact on teen employment before the Great Recession. During the Great Recession, the disemployment effects of minimum wages were insignificant. The finding is consistent with the evolution of firms’ market power during the business cycle. Originality/value - The authors attempt to reconcile the debate about the effects of minimum wages on US employment.

Suggested Citation

  • Oudom Hean & Nanxin Deng, 2022. "The effects of minimum wages over the business cycle: the Great Recession," International Journal of Manpower, Emerald Group Publishing Limited, vol. 44(1), pages 19-36, May.
    • Handle: RePEc:eme:ijmpps:ijm-07-2021-0402
    DOI: 10.1108/IJM-07-2021-0402
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    More about this item

    Keywords

    Minimum wage; Business cycle; Labour market; J23; J38; J88;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J88 - Labor and Demographic Economics - - Labor Standards - - - Public Policy

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