Whether a moderate increase in the minimum wage measurably reduces employment among low-wage workers is one of the longest-running empirical disputes in labor economics, pitting the textbook supply-and-demand prediction against a body of quasi-experimental studies that find little or no employment effect.
Open Question
David Card and Alan Krueger's 1994 study of New Jersey and Pennsylvania fast-food employment found no negative employment effect from a minimum-wage increase, contradicting the standard supply-and-demand prediction that a binding wage floor prices low-skilled workers out of work. Neither side has been able to close the dispute: later meta-analyses and replications split along methodological lines, with studies using different comparison groups, time windows and industries reaching different conclusions, so the disagreement persists among credentialed labor economists rather than resting on a factual gap either side denies.
What would resolve this A body of quasi-experimental evidence, across enough minimum-wage changes, industries and regions, and using a comparison-group design both sides of the methodological debate accept, converging on a consistent sign and magnitude for the employment effect.
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