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A Note on the Robustness of Card and Krueger (1994) and Neumark and Wascher (2000)

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  • Ropponen, Olli

Abstract

This note adds to the discussion originating from David Card and Alan B. Krueger (1994; CK) and David Neumark and William Wascher (2000; NW). It re-evaluates their results by using the semiparametric difference-in-differences estimator introduced by Alberto Abadie (2005). The re-evaluation suggests that the original results on the average employment effect in CK and NW are fairly robust, although the NW results are slightly diluted when taking into account the differences in the distributions of the observed covariates.

Suggested Citation

  • Ropponen, Olli, 2011. "A Note on the Robustness of Card and Krueger (1994) and Neumark and Wascher (2000)," Working Papers 25, VATT Institute for Economic Research.
    • Handle: RePEc:fer:wpaper:25
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    File URL: https://www.doria.fi/handle/10024/148764
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    1. Olli Ropponen, 2011. "Reconciling the evidence of Card and Krueger (1994) and Neumark and Wascher (2000)," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 26(6), pages 1051-1057, September.
    2. Card, David & Krueger, Alan B, 1994. "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania," American Economic Review, American Economic Association, vol. 84(4), pages 772-793, September.
    3. William Wascher & David Neumark, 2000. "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania: Comment," American Economic Review, American Economic Association, vol. 90(5), pages 1362-1396, December.
    4. Alberto Abadie, 2005. "Semiparametric Difference-in-Differences Estimators," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 72(1), pages 1-19.
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    Cited by:

    1. Eerola, Essi & Lyytikäinen, Teemu, 2015. "On the role of public price information in housing markets," Regional Science and Urban Economics, Elsevier, vol. 53(C), pages 74-84.

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    More about this item

    Keywords

    Employment; minimum wage; nonlinear treatment effect models; Labour market; Työmarkkinat; Taxation and Social Transfers; Julkisen talouden rahoitus ja tulonsiirrot; C210 - Econometric Methods: Single Equation Models; Single Variables: Cross-Sectional Models; Spatial Models; Treatment Effect Models; J230 - Employment Determination; Job Creation; Demand for Labor; Self-Employment; J380 - Wages; Compensation; and Labor Costs: Public Policy (wage subsidies; minimum wage legislation);
    All these keywords.

    JEL classification:

    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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