The Effects of Minimum Wages on the Distribution of Family Incomes: A Nonparametric Analysis

An oft-stated goal of the minimum wage is to raise incomes of poor or low-income families. We present nonparametric estimates of the effects of minimum wages on the distribution of family income relative to needs in the United States. Although minimum wages increase the incomes of some poor families...

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Bibliographic Details
Published in:The Journal of human resources 2005-10, Vol.XL (4), p.867-894
Main Authors: Neumark, David, Schweitzer, Mark, Wascher, William
Format: Article
Language:English
Subjects:
Control groups
Density estimation
Human resources
Income distribution
Income estimates
Minimum wage
Poverty
Poverty line
Proportions
Wages
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Summary:An oft-stated goal of the minimum wage is to raise incomes of poor or low-income families. We present nonparametric estimates of the effects of minimum wages on the distribution of family income relative to needs in the United States. Although minimum wages increase the incomes of some poor families, the evidence indicates that their overall net effect is, if anything, to increase the proportions of families with incomes below or near the poverty line. It would appear that reductions in the proportions of families that are poor or near-poor should not be counted among the potential benefits of minimum wages.
ISSN:0022-166X
1548-8004
DOI:10.3368/jhr.XL.4.867