Skip navigation
Please use this identifier to cite or link to this item: http://arks.princeton.edu/ark:/88435/dsp012n49t404g
Title: MINIMUM WAGE AND THE BOTTOM LINE: A DIFFERENCE-­IN-­DIFFERENCE ANALYSIS
Authors: MUKHERJEE, PRATYUSHA
Advisors: Dobbie, Will S.
Department: Economics
Class Year: 2015
Abstract: This paper investigates the impact of the 2007 United States federal minimum wage increase on the bottom line—the expected and realized profitability of affected employers. The presence of state-­specific minimum wage laws produces a natural variation in across-­firm exposure to the minimum wage increase. I determine the treatment intensity experienced by each firm under study by constructing a profile of its geographic distribution across the country. This information is then used to evaluate the effect of the minimum wage increase on expected profitability, using an event study methodology, and on realized profitability, via difference‐in‐difference regression analysis. I find a significant negative impact on both the short­‐term stock prices and accounting profits of firms with a high concentration of minimum wage workers.
Extent: 77 pages
URI: http://arks.princeton.edu/ark:/88435/dsp012n49t404g
Type of Material: Princeton University Senior Theses
Language: en_US
Appears in Collections:Economics, 1927-2016

Files in This Item:
File SizeFormat 
PUTheses2015-MUKHERJEE_PRATYUSHA.pdf8.02 MBAdobe PDF    Request a copy


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