IDEAS home Printed from https://ideas.repec.org/a/fip/fedhle/y2013iaugn313.html
   My bibliography  Save this article

How does a federal minimum wage hike affect aggregate household spending?

Author

Listed:
  • Daniel Aaronson
  • Eric French

Abstract

This article finds that a federal minimum wage hike would boost the real income and spending of minimum wage households. The impact could be sufficient to offset increasing consumer prices and declining real spending by most non-minimum-wage households and, therefore, lead to an increase in aggregate household spending. The authors calculate that a $1.75 hike in the hourly federal minimum wage could increase the level of real gross domestic product (GDP) by up to 0.3 percentage points in the near term, but with virtually no effect in the long term.

Suggested Citation

  • Daniel Aaronson & Eric French, 2013. "How does a federal minimum wage hike affect aggregate household spending?," Chicago Fed Letter, Federal Reserve Bank of Chicago, issue Aug.
    • Handle: RePEc:fip:fedhle:y:2013:i:aug:n:313
    as

    Download full text from publisher

    File URL: http://www.chicagofed.org/digital_assets/publications/chicago_fed_letter/2013/cflaugust2013_313.pdf
    Download Restriction: no
    ---><---

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. America is missing a golden opportunity to boost the job market
      by estewart@insider.com (Emily Stewart) in Business Insider on 2024-08-08 09:57:03

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gordon G. Sollars & Fred Englander, 2018. "Sweatshops: Economic Analysis and Exploitation as Unfairness," Journal of Business Ethics, Springer, vol. 149(1), pages 15-29, April.
    2. V. Kumar & Nita Umashankar & Kihyun Hannah Kim & Yashoda Bhagwat, 2014. "Assessing the Influence of Economic and Customer Experience Factors on Service Purchase Behaviors," Marketing Science, INFORMS, vol. 33(5), pages 673-692, September.
    3. Young Cheol Jung & Adian McFarlane & Anupam Das, 2021. "The effect of minimum wages on consumption in Canada," The Economic and Labour Relations Review, , vol. 32(1), pages 65-89, March.
    4. Leila Sabokkhiz & Fatma Guven Lisaniler & Ikechukwu D. Nwaka, 2021. "Minimum Wage and Household Consumption in Canada: Evidence from High and Low Wage Provinces," Sustainability, MDPI, vol. 13(12), pages 1-20, June.
    5. Reich, MIchael & Jacobs, Ken & Bernhardt, Annette, 2014. "Local Minimum Wage Laws: Impacts on Workers, Families and Businesses," Institute for Research on Labor and Employment, Working Paper Series qt9pf1225f, Institute of Industrial Relations, UC Berkeley.

    More about this item

    Keywords

    Minimum wage;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fedhle:y:2013:i:aug:n:313. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Lauren Wiese (email available below). General contact details of provider: https://edirc.repec.org/data/frbchus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.