Date of Award

2014

Document Type

Thesis

Degree Name

Bachelors

Department

Social Sciences

First Advisor

Coe, Richard

Keywords

Economics, Poverty, Minimum Wage, Wage Gap

Area of Concentration

Economics

Abstract

Since the 1960s, the real value of the minimum wage has decreased significantly. This has been linked to high poverty rates among minimum wage earners. Economists debate whether or not a higher minimum wage would address this problem effectively. This thesis examines whether an increase in the minimum wage would increase economic well being of minimum wage workers. Using data from the Panel Study of Income Dynamics, this study analyzes how an increase in the federal minimum wage from $7.25 to $10.10 would affect poverty rate among low-income households. The results of this study suggest that such an increase could significantly reduce poverty rates and the size of the poverty gap. This suggests that raising the minimum wage is an effective anti-poverty tool.

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