The Effect of the Minimum Wage on Hours of Work
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In this paper, I use data from the American Time Use Survey to determine whether there is a causal relationship between the minimum wage and hours of work. As hiring and firing decisions are costly, it may be the case that the total level of employment is more readily reduced by cutting back on workers’ hours rather than laying off workers in a way that would affect the unemployment rate. If so, this would suggest that empirical inference regarding the effect of the minimum wage on employment should account for the possibility of a reduction in employment that occurs partially through reduced hours of work. Using standard linear regression analysis, I estimate that a 10% increase in the minimum wage is associated with a 1.67% decrease in hours of work for workers earning less than $12 per hour. Difference-in-differences analysis leads to the conclusion that the July 2007 federal minimum wage increase caused hours of work to decrease by approximately 4.3 hours per week.
Masucci, Alex (2015). The Effect of the Minimum Wage on Hours of Work. Undergraduate Research Scholars Program. Available electronically from