An Empirical Analysis of the Effects an Increased Minimum Wage has on Poverty

Kray, Aidan
2023
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https://hdl.handle.net/11299/254196
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An Empirical Analysis of the Effects an Increased Minimum Wage has on Poverty

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2023

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Recently, minimum wages have been a newsworthy topic, particularly in relation to poverty. This paper examines empirical evidence across all 50 states and Washington D.C. to evaluate the impact minimum wage increases have had on poverty rates. Using 19 years (the years 2000 through 2018) individual states are analyzed to provide a broader understanding of the relationship. The Years examined provide a a large sample size while avoiding the effects of the COVID years and related fiscal policy. Panel regression analysis was utilized to determine the effects different variables have on poverty rates. The main area of focus was the effects of changes in the real minimum wage, and the results indicate that there is a negative relationship between real minimum wages and poverty rates; however, years that had increases in the nominal minimum wage did not have lower poverty rates. The combination of these two results indicate that the declining real value of minimum wages result in an increase of poverty rates. Such findings can be informative to current policy debates on the value of increasing minimum wages.

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Faculty Mentor: Neil Wilmot

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Kray, Aidan. (2023). An Empirical Analysis of the Effects an Increased Minimum Wage has on Poverty. Retrieved from the University Digital Conservancy, https://hdl.handle.net/11299/254196.

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