Research on the Effects of Raising the Minimum Wage

Recent minimum wage increases in 20 states and efforts by states including New York and California, and cities such as Seattle, to raise the minimum wage to $15 per hour have ignited the debate over the labor market effects of raising the minimum wage. An effort to set a federal $15 minimum wage has gained new traction under the Biden administration. Researchers using different methods and control groups often come up with different findings. However, an exhaustive meta-analysis of over 200 empirical studies by Dale Belman and Paul J. Wolfson offers the strongest evidence yet on the effects of the minimum wage on employment, wages, poverty and inequality, and effect by gender. Read more.

Meanwhile, recent Upjohn Institute research shows that the pass-through effect of minimum wage increases on prices is smaller than previously thought;  small raises in the minimum wage lead to slower wage growth for low-wage workers; and that the minimum wage reduces job growth over a period of several years with the effects being strongest for younger workers and for those in industries with a higher proportion of low-wage-workers. Other research shows less clear results of increasing the minimum wage as an antipoverty tool in disadvantaged neighborhoods and a decrease of worker hours and increase in capital investment following minimum wage increases:

Also of interest – "Ranking Firms Using Revealed Preference and Other Essays about Labor Markets" by Isaac Sorkin