distribution of income


This paper analyses the distributional impact of the 1990 and 1991
increases in the federal minimum wage. The rise in the federal minimum wage
had very different impacts across states, depending on state-specific minimum
wage floors and the overall level of wages in each state. In states with a
higher fraction of workers affected by the minimum wage change, we find that
the minimum wage hike generated significant increases in the lower percentiles
of wages, and significant reductions in wage dispersion. The higher minimum
wage also led to increases in the lower percentiles of the family earnings
distribution, and a narrowing of the dispersion in family earnings. We find
some evidence that the increase in the minimum wage lowered poverty rates for
families with some attachment to the labor market.

Year of Publication
Date Published
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Citation Key
Krueger, A., & Card, D. (1994). A Living Wage? The Effects of the Minimum Wage on the Distribution of Wages, the Distribution of Family Earnings, and Poverty. Retrieved from http://arks.princeton.edu/ark:/88435/dsp013484zg89t (Original work published October 1994)
Working Papers