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on Unemployment, Inequality and Poverty |
| By: | Blau, Francine D. (Cornell University); Cohen, Isaac; Comey, Matthew (Cornell University); Kahn, Lawrence M. (Cornell University); Boboshko, Nikolai (Cornell University) |
| Abstract: | Using 1979-2019 Current Population Survey data, we study the effect of state and federal minimum wage policies on gender, race, and ethnic inequality. We find that minimum wages substantially reduce intergroup wage inequality at least up to the 20th wage percentile, with no evidence of adverse employment effects. We conduct counterfactual simulations of between-group inequality due to minimum wage changes since 1979. Declines in the real minimum wage in the 1980s slowed progress in narrowing between-group inequality. Relatively small changes in minimum wages during 1989-1998 and 1998-2007 meant little role for the minimum wage over those time spans. Since 2007, several states have steeply raised their minimum wages, especially raising Hispanics’ relative wages, because they earn low wages and reside disproportionately in those states. Finally, we find that raising the federal minimum wage to $12/hour in 2020 dollars ($14.49 in 2025Q2 dollars) would reduce existing between-group wage gaps below the 15th percentile by 25-50%. |
| Keywords: | Hispanic-White wage gaps, race wage gaps, gender wage gaps, wage differentials, wage distribution, minimum wage, wage inequality |
| JEL: | J15 J16 J31 J38 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18345 |
| By: | Francine D. Blau; Isaac Cohen; Matthew Comey; Lawrence Kahn; Nikolai Boboshko |
| Abstract: | Using 1979-2019 Current Population Survey data, we study the effect of state and federal minimum wage policies on gender, race, and ethnic inequality. We find that minimum wages substantially reduce intergroup wage inequality at least up to the 20th wage percentile, with no evidence of adverse employment effects. We conduct counterfactual simulations of between-group inequality due to minimum wage changes since 1979. Declines in the real minimum wage in the 1980s slowed progress in narrowing between-group inequality. Relatively small changes in minimum wages during 1989-1998 and 1998-2007 meant little role for the minimum wage over those time spans. Since 2007, several states have steeply raised their minimum wages, especially raising Hispanics’ relative wages, because they earn low wages and reside disproportionately in those states. Finally, we find that raising the federal minimum wage to $12/hour in 2020 dollars ($14.49 in 2025Q2 dollars) would reduce existing between-group wage gaps below the 15th percentile by 25-50%. |
| Keywords: | wage inequality, minimum wage, wage differentials, gender wage gaps, race wage gaps, hispanic-white wage gaps |
| JEL: | J15 J16 J31 J38 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12371 |
| By: | Deng, Zichen (University of Amsterdam); Luo, Weixiang (Fudan University, China); Plug, Erik (University of Amsterdam); Yu, Jia (Peking University) |
| Abstract: | We document, for the very first time, the relationship between earnings and sexual orientation in China. Using data from the 2020 Chinese Private Life Survey, we find that gay men earn significantly less than comparable heterosexual men, with the largest penalties for rural-hukou holders and among men reporting exclusive same-sex attraction. Lesbian women tend to earn more than heterosexual women, but the differences are small and mostly insignificant. The estimates for bisexual men and women are uniformly insignificant. We conclude that the gay penalties and lesbian premiums in China, albeit imprecisely estimated, mirror those observed in Western labor markets and are most consistent with explanations based on conventional gender norms and intra-household specialization. |
| Keywords: | earnings, sexual orientation, China |
| JEL: | D10 J10 J15 J30 J70 O10 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18317 |
| By: | De Vera, Micole (Banco de España); Garcia-Brazales, Javier (CEMFI); Lin, Jiayi (Universitat Pompeu Fabra) |
| Abstract: | What determines long-term mental health and its intergenerational correlation? Exploiting variation in unemployment rates upon labor market entry across Australian states and cohorts, we provide novel evidence that the mental health of daughters is affected by the labor market entry conditions of their parents. In particular, a one standard deviation shock to the unemployment rate upon parental labor market entry worsens daughters' mental health during adolescence by 11% of a standard deviation. This effect is accompanied by lower levels of satisfaction with their health, financial situation, safety, and overall life. A mediation analysis suggests that a sizable proportion (24%) of the impacts on the descendants' mental health is explained by the worse mental health of their parents at mid-life. We do not detect any systematic impact of parental labor market entry conditions among sons. |
| Keywords: | intergenerational correlation, well-being, mental health, recession, Australia |
| JEL: | E32 I14 I31 J62 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18305 |