City Minimum Wages and Spatial Equilibrium Effects

Local minimum wage laws are becoming common across U.S. cities, and their effects may be different from the effects of state or national minimum wage policies. This paper studies the effect of changes in the minimum wage on spatial equilibriums in local labor markets. Using residence and workplace data for the United States, I analyze how commuting, residence, and employment locations change across city and state borders if the minimum wage changes on one side of the border. I find that areas in which the minimum wage increases receive fewer low-wage commuters. A 10 percent increase in the minimum wage reduces the inflow of low-wage commuters by about 2.5 percent. Rises in the minimum wage are also associated with employment relocation across borders toward areas that did not witness an increase in the minimum wage. I formulate a spatial equilibrium gravity model to explain the distribution of workers between low- and high-minimum wage areas. I calculate counterfactual equilibriums with a higher minimum wage for U.S. counties with cities considering an increase, highlighting the role of commuting and migration responses. About two-fifths of the counties considering increases would receive fewer low-wage commuters. Employment relocation away from high-minimum wage areas drives the commuting losses.

Differential relationship between state-level minimum wage and infant mortality risk among US infants born to white and black mothers

BackgroundCompared to other Organisation for Economic Co-operation and Development (OECD) nations, US infant mortality rates (IMRs) are particularly high. These differences are partially driven by racial disparities, with non-Hispanic black having IMRs that are twice those of non-Hispanic white. Income inequality (the gap between rich and poor) is associated with infant mortality. One proposed way to decrease income inequality (and possibly to improve birth outcomes) is to increase the minimum wage. We aimed to elucidate the relationship between state-level minimum wage and infant mortality risk using individual-level and state-level data. We also determined whether observed associations were heterogeneous across racial groups.MethodsData were from US Vital Statistics 2010 Cohort Linked Birth and Infant Death records and the 2010 US Bureau of Labor Statistics. We fit multilevel logistic models to test whether state minimum wage was associated with infant mortality. Minimum wage was standardised using the z-transformation and was dichotomised (high vs low) at the 75th percentile. Analyses were stratified by mother's race (non-Hispanic black vs non-Hispanic white).ResultsHigh minimum wage (adjusted OR (AOR)=0.93, 95% CI 0.83 to 1.03) was associated with decreased odds of infant mortality but was not statistically significant. High minimum wage was significantly associated with reduced infant mortality among non-Hispanic black infants (AOR=0.80, 95% CI 0.68 to 0.94) but not among non-Hispanic white infants (AOR=1.04, 95% CI 0.92 to 1.17).ConclusionsIncreasing the minimum wage might be beneficial to infant health, especially among non-Hispanic black infants, and thus might decrease the racial disparity in infant mortality.