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The fact that these differences show up in both employment and poverty analyses is intriguing to us, and suggests that it may be useful to apply research strategies from previous papers that discovered disemployment effects to data from the 1990s to see if these results continue to hold.
Our results suggest that indexing produces larger disemployment effects than nominal minimum wage increases.
If the latter explanation is correct, the disemployment effects should be greater the higher the minimum wage.
They do not find disemployment effects associated with the minimum wage increase.
(2) Neumark and Wascher (2007, 2008) review more than 90 of these studies and conclude that the evidence that the lowest-skilled workers experience the strongest disemployment effects is "overwhelming," and place employment elasticities in this literature from -0.1 to -0.3.
On the other hand, if transitions in to poverty are more common when minimum wages increase, we would infer that the disemployment effects of minimum wages play a dominant role among the low-income population.
Given the limited published evidence on the employment effects of past comparable worth wage increases, it would be difficult to make any conclusive statement about the size of potential disemployment effects.
Thus, while minimum wages create disemployment, those workers who remain employed in jobs covered by the minimum wage benefit.
(66) In a review of the literature, Neumark and Wascher found that the vast majority of studies reveal negative employment effects of raising the minimum wage and "overwhelming evidence of stronger disemployment effects" for low-skilled workers.
For each of these simulations, we assume that there are no disemployment effects or reductions in hours worked among workers due to minimum-wage hikes.
In addition, given that recent evidence using the longest available time series indicates no significant disemployment effects of minimum wages (Card and Krueger [1995b]), some have argued that it is irrelevant whether earlier studies obtained estimates that were influenced by publication bias.
As long as the pecuniary wage is flexible downward, there is no risk of disemployment. Yet, this flexible wage condition might well not be met.