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What other industries? Are these other industries businesses where minimum wage laborers are a significant part of the labor? An increase in minimum wage isn't

What other industries? Are these other industries businesses where minimum wage laborers are a significant part of the labor? An increase in minimum wage isn't going to hurt businesses in an industry where you have few if any minimum wage laborers. If you have specific contradictory evidence, cite it instead of a vague handwavy response.

wahern 9y ago
By across industries I meant studies that look at the impact of minimum wage changes in geographic regions, which would include not only the restaurant industry but all industries. For example, some studies have looked at metropolitan areas that span multiple jurisdictions (i.e. straddling a state line) where one jurisdiction increased the minimum wage but the other didn't, so that you have something approximating a control group. If you look at all the literature, the results are mixed and equivocal, at least for modest changes in the minimum wage. See the empirical studies section on Wikipedia https://en.wikipedia.org/wiki/Minimum_wage#Empirical_studies or a discussion of minimum wage studies in an economics textbook, such as The Economic Way of Thinking, Paul L. Heyne, et al. Fundamental economic laws tells us that an increase in the minimum wage should result in a decrease in labor demand. But the numerous empirical studies are so equivocal and so obviously confounded that it's utterly naive to assume (as we normally assume, and indeed normally should assume) to see a simple labor demand response. Exogenous and second-order effects seem to be huge. So whenever you see a study that purports to claim (or is held out to evidence) either that an increase in the minimum wage decreases overall labor demand _or_ that it decreases income inequality, we should be highly skeptical. Of course, the paper you cited doesn't make any claims about aggregate labor demand, nor even labor demand in the restaurant industry. It only looks at exists and entries using some novel data sources. The only truly interesting thing about that paper, IMO, is it's novel use of Yelp. That paper raises a ton of questions--good questions--about data sources and methodologies. I wouldn't venture to rely on it's conclusions for any economics argument.

wahern 9y ago

By across industries I meant studies that look at the impact of minimum wage changes in geographic regions, which would include not only the restaurant industry but all industries. For example, some studies have looked at metropolitan areas that span multiple jurisdictions (i.e. straddling a state line) where one jurisdiction increased the minimum wage but the other didn't, so that you have something approximating a control group. If you look at all the literature, the results are mixed and equivocal, at least for modest changes in the minimum wage. See the empirical studies section on Wikipedia https://en.wikipedia.org/wiki/Minimum_wage#Empirical_studies or a discussion of minimum wage studies in an economics textbook, such as The Economic Way of Thinking, Paul L. Heyne, et al. Fundamental economic laws tells us that an increase in the minimum wage should result in a decrease in labor demand. But the numerous empirical studies are so equivocal and so obviously confounded that it's utterly naive to assume (as we normally assume, and indeed normally should assume) to see a simple labor demand response. Exogenous and second-order effects seem to be huge. So whenever you see a study that purports to claim (or is held out to evidence) either that an increase in the minimum wage decreases overall labor demand _or_ that it decreases income inequality, we should be highly skeptical. Of course, the paper you cited doesn't make any claims about aggregate labor demand, nor even labor demand in the restaurant industry. It only looks at exists and entries using some novel data sources. The only truly interesting thing about that paper, IMO, is it's novel use of Yelp. That paper raises a ton of questions--good questions--about data sources and methodologies. I wouldn't venture to rely on it's conclusions for any economics argument.