Title

An Evaluation of the Relationship Between Minimum Wage and Unemployment: Does the Local Cost-of-Living Matter?

Document Type

Article

Publication Date

2018

Publication Title

Applied Economics Letters

DOI

10.1080/13504851.2017.1340562

ISSN

1466-4291

Abstract

This article examines the relationship between federal, state and municipal minimum wage laws, local cost-of-living (COL) and the unemployment rate. It finds a strong statistically significant positive relationship between minimum wages and unemployment once COL is taken into account. Our results suggest that federal minimum wage policy is likely to have more harmful effects in rural/low cost areas.

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