Income Security Policy Paper No. 10
Putting the Minimum Wage Debate in a Historical Context: Card and Krueger Meet George Stigler
Richard V. Burkhauser, Kenneth A. Couch, and David Wittenburg
June 1995
Abstract: Half a century ago George Stigler stated that
evaluation of minimum wage policy should
revolve around two questions: Does such
legislation diminish poverty? Are there
efficient alternatives? This paper argues that
historically these were and continue to be
appropriate questions to ask with respect to
this policy. It then replicates and evaluates
the analysis in Chapter 9 of Myth and
Measurement: The New Economics of the Minimum
Wage with regards to these questions.
Given the evolution of the Earned Income Tax
Credit we conclude that, aside from nostalgia,
it is hard to explain the continued support
for increasing the minimum wage by those
interested in helping the working poor, and
that Card and Krueger provide little new
evidence to rekindle such support.
A revised version of this paper was
published as "Who Gets What From Minimum
Wage Hikes: A Replication and Re-estimation of
Card and Krueger," Industrial
and Labor Relations Review,
49(3)(April 1996): 547-552. Those interested
in this work should see that journal.
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