Key research papers on the minimum wage

How the literature is organised

Two papers in the same 1992 volume of Industrial and Labor Relations Review point in different directions, and the field has been arguing ever since. Card (1992) used the fact that the April 1990 federal increase bit harder in some states than others and found that teenagers' wages rose with no corresponding loss of teenage employment. Neumark and Wascher (1992), using a state panel for 1973–89, estimated that a 10% increase in the minimum wage reduces teenage employment by 1–2%, a range they note matches the earlier time-series studies. The Card and Krueger comparison of fast-food restaurants either side of the New Jersey–Pennsylvania border belongs to the same moment; this page lists their 2000 reply to Neumark and Wascher's comment on it.

Since then the argument has been about control groups. Dube, Lester and Reich (2010) compared all contiguous county pairs straddling a state border between 1990 and 2006, found no adverse employment effects, and argued that designs ignoring local economic conditions produce spurious negative results. Neumark, Salas and Wascher (2014) tested the assumptions behind those designs, found problems with them, and reaffirmed teen employment elasticities near −0.15. Meer and West (2016) argue the effect shows up in job growth over several years rather than in an immediate drop in levels. Cengiz et al. (2019) looked at the whole wage distribution around the threshold across 138 state-level changes. Doucouliagos and Stanley (2009) applied meta-regression to 64 US studies and estimated publication selection bias slightly larger than the average reported effect; correcting for it, they say, leaves little or no evidence of a negative association.

A separate strand studies inequality. Lee (1999) found that the falling real federal minimum can account for much of the rise in lower-tail wage dispersion in the 1980s, particularly for women. Autor, Manning and Smith (2016) reassessed the same question with more decades of data and an instrumental-variable strategy, and found the effect real but substantially smaller than earlier estimates, with spillovers above the binding threshold that they cannot rule out as reporting artefacts.

Main debates

Beyond employment counts, researchers now ask where the adjustment happens. Clemens (2021) sets out the non-employment margins one by one: evasion, output prices, non-cash compensation, job attributes including effort requirements, the mix of low- and high-skilled labour, and the mix of labour and capital. The listed studies find several of them at work. Jardim et al. (2022) found no change in the probability of continued employment in Seattle but significant reductions in hours, with turnover and new hiring both down. Coviello, Deserranno and Persico (2022), using a border discontinuity at a large US retailer, found workers became more productive and were terminated less often — except where monitoring was light, when productivity fell. Geng et al. (2022) found Chinese firms raised capital investment in response. Dütsch, Ohlert and Baumann (2025) report that German firms' wage costs rose without a productivity change, so profits fell.

Where recent work is heading

Recent well-cited studies use administrative data and specific reforms. Engbom and Moser (2022) attribute 45% of the large fall in Brazilian earnings inequality between 1996 and 2018 to a 128% real increase in the minimum wage, with employment effects muted by reallocation toward more productive firms. Bossler and Schank (2023) find that about half of the post-2010 decrease in German wage inequality followed the 2015 national minimum wage, with negligible employment effects. Jardim et al. (2022) cover Seattle's increases, and Coviello, Deserranno and Persico (2022) a large US retailer.

Neumark (2024) reviews effects beyond the labour market and is careful about it: evidence on physical health leans adverse, diet and obesity findings are mixed, smoking and drinking may rise, suicides appear to fall, and his conclusion is that policy claims that minimum wages improve health are unwarranted or premature. Note that only two works on this page are classified as reviews — economics publishes its overviews in outlets like the Journal of Economic Perspectives (Clemens, 2021) without calling them reviews, so a filter for review articles will miss them.