Do large minimum wage increases reduce hours worked more than small ones?
Core argument: Using CPS and ACS data under a partially pre-committed analysis plan, the authors estimate that large statutory minimum wage increases are associated with a differential decline in hours worked of -0.73 hours on average across specifications and primary samples.
Analyzing CPS and ACS data with the empirical specifications from our partially pre-committed analysis plan [outlined in previous papers],we estimate that the elasticity of hours worked with respect to the minimum wage is substantially more negative for large minimum wage increases than for small increases. Large statutory minimum wage changes are, on average, associated with a differential hours worked decline of -0.73 hours across the full set of specifications we estimate, averaging across our primary analysis samples. The estimates are more negative for the sample consisting of individuals ages 16 to 25 with less than a completed high school education (-0.94 hours) than for the larger sample of all individuals ages 16 to 21 (-0.51 hours). The hours worked declines associated with legislation rise as the increases are phased in over time. Hours worked effects for 16-25 year olds with less than a completed high school education average -0.38 hours through an endline consisting solely of 2015 and average -1.16 hours estimated through an endline consisting solely of 2019. Equivalent estimates for the “young adult” population ages 16 to 21 are -0.26 and -0.66, respectively.