The Iowa Employment data as reported by WWW. FreeLunch.Com shows an increase in unemployment since Iowa raised the minimum wage rate in April, 2007. FreeLunch is a division of Moody's so I believe the data is reliable.
This is similar to the conclusion drawn by Kreuger and Card, and subject to the same critique. There are too many uncontrolled variables for this to be a statistically valid result. I figure you know them, but an off-the-top-of-the-head list would include: seasonality, general economic trends, policy changes (not just minimum wage) of instant and adjacent areas, demographic adjustments (short-term and long-term), opportunity changes for the relevant demographics (e.g., does ramping up Iowa election machines create more minimum wage jobs?), etc.
Interesting blog, though. I'm particularly interested by the fact that you appear to be teaching economics to high school students. Is that right? I consider that God's work.
yes i teach at the high school level...you are right to guess that i'm having a hard time controlling all of the variables when i interpret the data...my first guess was that the college students might have caused the data to look better than it really is since the state is higher and increasing each month...now, i'm not so sure that hours weren't just cut back but the labor was retained....thanks so much, flad
This is similar to the conclusion drawn by Kreuger and Card, and subject to the same critique. There are too many uncontrolled variables for this to be a statistically valid result. I figure you know them, but an off-the-top-of-the-head list would include: seasonality, general economic trends, policy changes (not just minimum wage) of instant and adjacent areas, demographic adjustments (short-term and long-term), opportunity changes for the relevant demographics (e.g., does ramping up Iowa election machines create more minimum wage jobs?), etc.
ReplyDeleteInteresting blog, though. I'm particularly interested by the fact that you appear to be teaching economics to high school students. Is that right? I consider that God's work.
yes i teach at the high school level...you are right to guess that i'm having a hard time controlling all of the variables when i interpret the data...my first guess was that the college students might have caused the data to look better than it really is since the state is higher and increasing each month...now, i'm not so sure that hours weren't just cut back but the labor was retained....thanks so much, flad
ReplyDelete