June 30, 2017
For over 20 years now, many highly credible studies have found that the disemployment effects of higher minimum wages are generally very close to zero. The pioneering empirical work by Princeton economists David Card (a Canadian) and Alan Krueger in the 1990s investigated empirical data on the impacts of real-world minimum-wage increases by carefully studying the natural experiments created when one jurisdiction increased its minimum wage, but others – often right across a state boundary – did not.
Their results shocked the economics profession. They found almost no impact of higher minimum wages on employment – and in some cases higher minimum wages were associated with more employment. Their now-classic book, Myth and Measurement, published in 1995, initially sparked enormous controversy. But the essence of scientific advance is the replication of empirical results. Since then, many highly credible empirical studies have confirmed the basic findings: there is almost no employment impact from moderate increases in minimum wages.