The Effects of Minimum Wages on the Distribution of Family Incomes: A Non-Parametric Analysis

David Neumark, Mark Schweitzer, William Wascher

NBER Working Paper No. 6536
Issued in April 1998
NBER Program(s):   LS

The primary goal of a national minimum wage floor is to raise the incomes of poor or near-poor families with members in the work force. However, estimates of employment effects of minimum wages tell us relatively little about whether minimum wages are likely to achieve this goal; even if the disemployment effects of minimum wages are modest, minimum wage increases could result in net income losses for poor and low-income families. In this paper, we present evidence on the effects of minimum wages on family incomes from matched March CPS surveys. Using non-parametric estimates of the distributions of family income relative to needs in states and years with an without minimum wage increases, we examine the effects of minimum wages on this distribution, and on the distribution of the changes in income that families experience. Although minimum wages do increase the incomes of some poor families, the evidence indicates that the overall effects are to increase the proportion of families that are poor and near-poor, and to decrease the proportion of families with incomes between 1.5 and 3 times the poverty level.

download in pdf format
   (1396 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w6536

Published: Journal of Human Resources, Vol. 40, no. 4 (Autumn 2005): 867-894 citation courtesy of

Users who downloaded this paper also downloaded* these:
Neumark, Schweitzer, and Wascher w7519 The Effects of Minimum Wages Throughout the Wage Distribution
Brown, Gilroy, and Kohen w0846 The Effect of the Minimum Wage on Employment and Unemployment: A Survey
Card and Krueger w4509 Minimum Wages and Employment: A Case Study of the Fast Food Industry in New Jersey and Pennsylvania
Neumark and Wascher w12663 Minimum Wages and Employment: A Review of Evidence from the New Minimum Wage Research
Neumark and Wascher w6127 Do Minimum Wages Fight Poverty?
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us