San Francisco minimum wage effects: very small and unlikely to have been negative

Reading a chapter form the book When Mandates Work: Raising Labor Standards at the Local Level edited by Michael Reich, Ken Jacobs, Miranda Dietz.  As I imagined, the effects were very small.

The counterfactual that many people have in mind I think is: Suppose the economy were not growing (San Francisco has been in an obvious 15 year tech-tourism boom with only minor interruptions), wouldn’t a minimum wage hike really hurt then?  Relative to another stagnant control group, a stagnating economy that raised the minimum wage would experience bad consequences.  But the political economy of the minimum wage likely means that is is only raised in relatively good times (I do not know if that is true or not), so we never observe the environment critics have in mind, so one wonders whether their criticisms really are empirical or ideological.

About mkevane

Economist at Santa Clara University and Director of Friends of African Village Libraries.
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