Living Wage Laws

Research Report

Living Wage Laws

How Much Do (Can) They Matter?
October 30, 2008

Abstract

In this paper, I review what we have learned about living wage laws and their impacts on the wages, employment and poverty rates of low-wage workers. I review the characteristics of these laws, predictions from economic theory about their likely effects, and two bodies of empirical evidence: studies across cities or metropolitan areas and those within particular cities. I conclude that living wage laws have modestly raised wage levels of low wage workers and have reduced their employment at covered firms, but that the magnitudes of both effects are likely quite small, given how few workers are usually covered by these ordinances.

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