Loading Events

« All Events

Virtual Event Virtual Event
  • This event has passed.

e61/Macquarie University Seminar Series with Erik Hurst | The Distributional Impact of the Minimum Wage in the Short and Long Run

28 March @ 2:00 pm - 3:00 pm AEDT

Virtual Event Virtual Event
Free

Presenter: Erik Hurst

Time & Location

28 March 2023, 2:00 pm – 3:00 pm AEDT
e61 Institute, Level 3/17-21 Bellevue Street Surry Hills NSW 2010, Australia | Online

About the event

We develop a framework with worker heterogeneity, monopsony power, and putty-clay technology in order to study the distributional impact of the minimum wage in the short and long run.

We discipline our model to match the small employment effects of the minimum wage in the short run and the large estimated elasticities of substitution across different workers in the long run. We find that in the short run, both small and large increases in the minimum wage have small impacts on employment and increase the labor income of the workers earning less than the new minimum. In the long run, the effects of the minimum wage greatly differ depending on the size of its increase: a small increase has a beneficial long-run impact on low-income workers in that it increases their employment, income, and welfare, whereas a large increase reduces the employment, income, and welfare of precisely the low-income workers it is meant to support. In either case, these long-run effects take time to fully materialize because firms slowly adjust their mix of inputs. Existing transfer programs, such as the earned-income tax credit (EITC) or a progressive tax system, are more effective than large increases in the minimum wage at improving long-run outcomes for workers at the low end of the wage distribution. But combining existing programs with a small increase in the minimum wage provides even larger welfare gains for those workers.

Details

Date:
28 March
Time:
2:00 pm - 3:00 pm AEDT
Cost:
Free

Venue

e61 Institute
Level 3/17-21 Bellevue Street
Surry Hills, NSW 2010 Australia
View Venue Website

Seminars

Views Navigation

Event Views Navigation

Today

Latest Past Events

e61 Lounge Session with Dr Guglielmo Briscese | What explains differences in savings? Evidence from a field experiment

e61 Institute Level 3/17-21 Bellevue Street, Surry Hills

Time & Location Thursday 7 September 2023, 12:00 pm – 1:00 pm Online via Zoom   About the event Dr Guglielmo Briscese will be presenting his paper, What explains differences in savings? Evidence from a field experiment, as part of e61 Institute's Lounge Sessions. The presentation will run for approximately 45 minutes followed by a …

e61 Lounge Session with Dr Guglielmo Briscese | What explains differences in savings? Evidence from a field experiment Read More »

Free

e61/Macquarie University Seminar Series with Erik Hurst | The Distributional Impact of the Minimum Wage in the Short and Long Run


e61 Institute Level 3/17-21 Bellevue Street, Surry Hills, NSW, 2010, Australia
Loading Events

« All Events

  • This event has passed.

e61/Macquarie University Seminar Series with Erik Hurst | The Distributional Impact of the Minimum Wage in the Short and Long Run

28 March @ 2:00 pm - 3:00 pm AEDT

Free

Presenter: Erik Hurst

Time & Location

28 March 2023, 2:00 pm – 3:00 pm AEDT
e61 Institute, Level 3/17-21 Bellevue Street Surry Hills NSW 2010, Australia | Online

About the event

We develop a framework with worker heterogeneity, monopsony power, and putty-clay technology in order to study the distributional impact of the minimum wage in the short and long run.

We discipline our model to match the small employment effects of the minimum wage in the short run and the large estimated elasticities of substitution across different workers in the long run. We find that in the short run, both small and large increases in the minimum wage have small impacts on employment and increase the labor income of the workers earning less than the new minimum. In the long run, the effects of the minimum wage greatly differ depending on the size of its increase: a small increase has a beneficial long-run impact on low-income workers in that it increases their employment, income, and welfare, whereas a large increase reduces the employment, income, and welfare of precisely the low-income workers it is meant to support. In either case, these long-run effects take time to fully materialize because firms slowly adjust their mix of inputs. Existing transfer programs, such as the earned-income tax credit (EITC) or a progressive tax system, are more effective than large increases in the minimum wage at improving long-run outcomes for workers at the low end of the wage distribution. But combining existing programs with a small increase in the minimum wage provides even larger welfare gains for those workers.

Details

Date:
28 March
Time:
2:00 pm - 3:00 pm AEDT
Cost:
Free

Venue

e61 Institute
Level 3/17-21 Bellevue Street
Surry Hills, NSW 2010 Australia
View Venue Website

Presenter: Erik Hurst

Time & Location

28 March 2023, 2:00 pm – 3:00 pm AEDT
e61 Institute, Level 3/17-21 Bellevue Street Surry Hills NSW 2010, Australia | Online

About the event

We develop a framework with worker heterogeneity, monopsony power, and putty-clay technology in order to study the distributional impact of the minimum wage in the short and long run.

We discipline our model to match the small employment effects of the minimum wage in the short run and the large estimated elasticities of substitution across different workers in the long run. We find that in the short run, both small and large increases in the minimum wage have small impacts on employment and increase the labor income of the workers earning less than the new minimum. In the long run, the effects of the minimum wage greatly differ depending on the size of its increase: a small increase has a beneficial long-run impact on low-income workers in that it increases their employment, income, and welfare, whereas a large increase reduces the employment, income, and welfare of precisely the low-income workers it is meant to support. In either case, these long-run effects take time to fully materialize because firms slowly adjust their mix of inputs. Existing transfer programs, such as the earned-income tax credit (EITC) or a progressive tax system, are more effective than large increases in the minimum wage at improving long-run outcomes for workers at the low end of the wage distribution. But combining existing programs with a small increase in the minimum wage provides even larger welfare gains for those workers.

Loading Events

« All Events

  • This event has passed.

e61/Macquarie University Seminar Series with Erik Hurst | The Distributional Impact of the Minimum Wage in the Short and Long Run

28 March @ 2:00 pm - 3:00 pm AEDT

Free

Presenter: Erik Hurst

Time & Location

28 March 2023, 2:00 pm – 3:00 pm AEDT
e61 Institute, Level 3/17-21 Bellevue Street Surry Hills NSW 2010, Australia | Online

About the event

We develop a framework with worker heterogeneity, monopsony power, and putty-clay technology in order to study the distributional impact of the minimum wage in the short and long run.

We discipline our model to match the small employment effects of the minimum wage in the short run and the large estimated elasticities of substitution across different workers in the long run. We find that in the short run, both small and large increases in the minimum wage have small impacts on employment and increase the labor income of the workers earning less than the new minimum. In the long run, the effects of the minimum wage greatly differ depending on the size of its increase: a small increase has a beneficial long-run impact on low-income workers in that it increases their employment, income, and welfare, whereas a large increase reduces the employment, income, and welfare of precisely the low-income workers it is meant to support. In either case, these long-run effects take time to fully materialize because firms slowly adjust their mix of inputs. Existing transfer programs, such as the earned-income tax credit (EITC) or a progressive tax system, are more effective than large increases in the minimum wage at improving long-run outcomes for workers at the low end of the wage distribution. But combining existing programs with a small increase in the minimum wage provides even larger welfare gains for those workers.

Details

Date:
28 March
Time:
2:00 pm - 3:00 pm AEDT
Cost:
Free

Venue

e61 Institute
Level 3/17-21 Bellevue Street
Surry Hills, NSW 2010 Australia
View Venue Website