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  5. The Elusive Employment Effect of the Minimum Wage

Journal of Economic Perspectives

ISSN 0895-3309 (Print) | ISSN 1944-7965 (Online)

The Elusive Employment Effect of the Minimum Wage

  • Alan Manning
Journal of Economic Perspectives
vol. 35, no. 1, Winter 2021
(pp. 3–26)
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Abstract

It is hard to find a negative effect on the employment effect of rises in the minimum wage: the elusive employment effect. It is much easier to find an impact on wages. This paper argues the elusive employment effect is unlikely to be solved by better data, methodology, or specification. The reasons for the elusive employment effect are the factors contributing to why the link between higher minimum wages and higher labor costs are weaker than one might think and because imperfect competition is pervasive in the labor market.

Citation

Manning, Alan. 2021. "The Elusive Employment Effect of the Minimum Wage." Journal of Economic Perspectives, 35 (1): 3–26. DOI: 10.1257/jep.35.1.3

Additional Materials

JEL Classification

  • J13 Fertility; Family Planning; Child Care; Children; Youth
  • J23 Labor Demand
  • J24 Human Capital; Skills; Occupational Choice; Labor Productivity
  • J31 Wage Level and Structure; Wage Differentials
  • J38 Wages, Compensation, and Labor Costs: Public Policy
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