Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/273660 
Year of Publication: 
2022
Series/Report no.: 
Working Papers No. 2022-04
Publisher: 
Banco de México, Ciudad de México
Abstract: 
This paper studies the effect of minimum wage changes on spatial equilibriums in local labor markets. Using data for the U.S. and minimum wage variation across state borders, I analyze how commuting, residence, and employment locations change in response to local minimum wage changes. I find that areas where the minimum wage increases receive fewer low-wage commuters. I formulate a spatial equilibrium model and calculate counterfactuals with a higher minimum wage for U.S. cities considering an increase. For small minimum wage increases, most counties would receive higher lowwage commuting and have fewer low-wage residents. As minimum wage increases are larger, there are higher low-wage commuting reductions driven by employment relocation.
Subjects: 
Minimum wage
spatial equilibrium
local labor markets
JEL: 
J31
J38
R23
Document Type: 
Working Paper
Appears in Collections:

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.