Minimum Wage and Real Wage Inequality: Evidence from Pass-Through to Retail Prices
| Autor: | Justin Leung |
|---|---|
| Rok vydání: | 2021 |
| Předmět: |
Wage inequality
Economics and Econometrics Labour economics ComputingMilieux_THECOMPUTINGPROFESSION Product market Inequality media_common.quotation_subject 05 social sciences Price controls Compensating differential Efficiency wage 0502 economics and business Economics Wage share 050207 economics Minimum wage Empirical evidence Social Sciences (miscellaneous) 050205 econometrics media_common |
| Zdroj: | The Review of Economics and Statistics. :1-16 |
| ISSN: | 1530-9142 0034-6535 |
| DOI: | 10.1162/rest_a_00915 |
| Popis: | Minimum wage policies are frequently cited by advocates as an anti-poverty tool. Essential to assessing this claim is to find out who benefits and who bears the costs of minimum wage changes. While a longstanding debate over the employment effects of the minimum wage has yet to reach a consensus, a smaller literature on its effect on prices has generally found small but positive effects. This paper adds to the existing literature by jointly considering the impact of the minimum wage on both labor and product markets, using detailed scanner data on purchase transactions of retail goods at the store level to overcome data problems in the previous literature. I provide empirical evidence that the minimum wage pass-through to retail prices in grocery stores is larger than expected because the minimum wage not only raised labor costs but also increased product demand, especially in poorer regions. This points to novel channels of heterogeneity in pass-through that have distributional consequences, with key implications for real wage inequality, residential segregation, and future minimum wage increases. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
|