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Does Minimum Wage Increase Labor Productivity? Evidence from Piece Rate Workers

Ku, H; (2022) Does Minimum Wage Increase Labor Productivity? Evidence from Piece Rate Workers. Journal of Labor Economics , 40 (2) pp. 325-359. 10.1086/716347.

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Abstract

We examine worker effort as a potential margin of adjustment to a minimum wage hike using unique data on piece rate workers who perform a homogenous task and whose individual output is rigorously recorded. By employing a difference-in-differences strategy that exploits the increase in Florida’s minimum wage from $6.79 to $7.21 on January 1, 2009, and worker location on the pre-2009 productivity distribution, we provide evidence consistent with incumbent workers’ positive effort responses.

Type: Article
Title: Does Minimum Wage Increase Labor Productivity? Evidence from Piece Rate Workers
DOI: 10.1086/716347
Publisher version: https://doi.org/10.1086/716347
Language: English
Additional information: This is the published version of record. For information on re-use, please refer to the publisher’s terms and conditions.
Keywords: minimum wage; incentive; effort; labor productivity JEL Codes: J20, J38, M50
UCL classification: UCL
UCL > Provost and Vice Provost Offices > UCL SLASH
UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS
UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS > Dept of Economics
URI: https://discovery.ucl.ac.uk/id/eprint/10101779
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