Monday, July 17, 2017

The claim by Card and Krueger that “Most studies published in the past 20 years found a negligible impact of minimum-wage increases on employment” is demonstrably false.

Letter to the Editor of The Washington Post by David Neumark
"As one of the authors of the study at issue in two recent letters — “The consequences aren’t surprising” by Rick Berman [July 4] and “Some omissions worth noting” by David Card and Alan Krueger [July 8] — I would like to set the record straight. My paper with William Wascher of the Federal Reserve board demonstrated that the central finding from the original Card-Krueger study — that a higher minimum wage increased fast-food employment — was wrong and was driven by inaccurate survey data. 

We used direct payroll records from companies, most of which we collected, and our study fully addressed data concerns. More generally, the claim by Card and Krueger that “Most studies published in the past 20 years found a negligible impact of minimum-wage increases on employment” is demonstrably false. Many recent studies using a variety of methods find job losses from a higher minimum wage. And while this issue, to be sure, is still debated among economists, evidence from a single very narrow industry, such as in the original Card-Krueger study of fast-food restaurants, cannot be definitive, as low-skill employment can fall overall while still rising in an isolated industry."

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