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Evaluating Living Wage Laws in the United States: Good Intentions and Economic Reality in Conflict?

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  • Robert Pollin

    (University of Massachusetts-Amherst)

Abstract

This article first examines the question, “What is a living wage?†and provides a range of specific dollar amounts derived through a conceptual assessment of the term. It then provides a series of cost estimates of living wage laws in various cities. Based on these cost estimates, the article examines a set of alternative adjustments that covered firms could make to absorb these costs, including raising prices and productivity, redistributing the firm’s income more equally, laying off employees, and relocating out of the area covered by the law. Prospective and retrospective evidence is used to reach an overall assessment of the benefits of living wage laws relative to their costs.

Suggested Citation

  • Robert Pollin, 2005. "Evaluating Living Wage Laws in the United States: Good Intentions and Economic Reality in Conflict?," Economic Development Quarterly, , vol. 19(1), pages 3-24, February.
    • Handle: RePEc:sae:ecdequ:v:19:y:2005:i:1:p:3-24
    DOI: 10.1177/0891242404268641
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    References listed on IDEAS

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    1. Timothy J. Bartik, 1991. "Who Benefits from State and Local Economic Development Policies?," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number wbsle, November.
    2. Robert Pollin & Mark D. Brenner & Stephanie Luce, 2002. "Intended vs. Unintended Consequences: Evaluating the New Orleans Living Wage Proposal," Working Papers wp9, Political Economy Research Institute, University of Massachusetts at Amherst.
    3. Timothy J. Bartik, 1992. "The Effects of State and Local Taxes on Economic Development: A Review of Recent Research," Economic Development Quarterly, , vol. 6(1), pages 102-111, February.
    4. Robert Pollin, 2002. "Living Wages, Poverty, and Basic Needs: Evidence from Santa Monica, CA," Working Papers wp33, Political Economy Research Institute, University of Massachusetts at Amherst.
    5. Robert Pollin & Jeannette Wicks-Lim & Mark D. Brenner, 2002. "Measuring the Impact of Living Wage Laws: A Critical Appraisal of David Neumark's How Living Wage Laws Affect Low-Wage Workers and Low-Income Families," Working Papers wp43, Political Economy Research Institute, University of Massachusetts at Amherst.
    6. Robert Pollin & Mark Brenner, 2000. "Economic Analysis of Santa Monica Living Wage Proposal," Research Reports rr2, Political Economy Research Institute, University of Massachusetts at Amherst.
    7. Robert Pollin & Mark Brenner & Stephanie Luce, 2002. "Intended versus Unintended Consequences: Evaluating the New Orleans Living Wage Ordinance," Journal of Economic Issues, Taylor & Francis Journals, vol. 36(4), pages 843-875, December.
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    Cited by:

    1. Andrea Werner & Ming Lim, 2016. "The Ethics of the Living Wage: A Review and Research Agenda," Journal of Business Ethics, Springer, vol. 137(3), pages 433-447, September.

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