TY  - JOUR
AU  - Neumark, David
AU  - Nizalova, Olena
TI  - Minimum Wage Effects in the Longer Run
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 10656
PY  - 2004
Y2  - July 2004
DO  - 10.3386/w10656
UR  - http://www.nber.org/papers/w10656
L1  - http://www.nber.org/papers/w10656.pdf
N1  - Author contact info:
David Neumark
Department of Economics
University of California, Irvine
3151 Social Science Plaza
Irvine, CA  92697
Tel: 949-824-8496
Fax: 949/824-2182
E-Mail: dneumark@uci.edu

Olena Nizalova
E-Mail: nizalova@msu.edu
AB  - Exposure to minimum wages at young ages may lead to longer-run effects. Among the possible adverse longer-run effects are decreased labor market experience and accumulation of tenure, lower current labor supply because of lower wages, and diminished training and skill acquisition. Beneficial longer-run effects could arise if minimum wages increase skill acquisition, or if short-term wage increases are long-lasting. We estimate the longer-run effects of minimum wages by using information on the minimum wage history that workers have faced since potentially entering the labor market. The evidence indicates that even as individuals reach their late 20's, they work less and earn less the longer they were exposed to a higher minimum wage, especially as a teenager. The adverse longer-run effects of facing high minimum wages as a teenager are stronger for blacks. From a policy perspective, these longer-run effects of minimum wages are likely more significant than the contemporaneous effects of minimum wages on youths that are the focus of most research and policy debate.
ER  -