State-by-State Minimum Wage Effects
Posted at 4 p.m. on Feb. 20
James Hamilton analyzes state data on unemployment levels and their respective minimum wages, finding almost no relationship in a regression.
“Of course, it is difficult to use data like these to assess the effect of changing the minimum wage on the unemployment rate. The reason is that there are important differences in a variety of characteristics across states… But the one thing that we can safely conclude…is that any relation between the minimum wage and the unemployment rate certainly isn’t obvious in these data.”