RE: Card/Krueger Revisited

[Seth Giertz]

Title:

Below is the abstract and link to a paper that addresses Card & Krueger's work.

The same authors have articles on the minimum wage coming out in the JoLE and the SEJ. [Burkhauser, R.V. ,Couch, K.A. Wittenburg, D. Who minimum Wage Increases Bite: An Analysis Using Monthly Data from the SIPP and CPS. Southern Economic Journal, 67(1), July 2000

Burkhauser, R.V., Couch, K.A., Wittenburg, D. A Reassessment of the New Economics of the Minimum Wage Literature Using Monthly Data from the CPS. Journal of Labor Economics, 17(4), October 2000.]

http://cpr.maxwell.syr.edu/incomsec/abstr10.htm
Abstract: Paper No. 10
Putting the Minimum Wage Debate in a Historical Context: Card and Krueger Meet George Stigler
Richard V. Burkhauser, Kenneth A. Couch, and David Wittenburg, June 1995

Half a century ago George Stigler stated that evaluation of minimum wage policy should revolve around two questions: Does such legislation diminish poverty? Are there efficient alternatives? This paper argues that historically these were and continue to be appropriate questions to ask with respect to this policy. It then replicates and evaluates the analysis in Chapter 9 of Myth and Measurement: The New Economics of the Minimum Wage with regards to these questions. Given the evolution of the Earned Income Tax Credit we conclude that, aside from nostalgia, it is hard to explain the continued support for increasing the minimum wage by those interested in helping the working poor, and that Card and Krueger provide little new evidence to rekindle such support.

A revised version of this paper was published as "Who Gets What From Minimum Wage Hikes: A Replication and Re-estimation of Card and Krueger," Industrial and Labor Relations Review, 49(3)(April 1996): 547-552. Those interested in this work should see that journal.

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-----Original Message-----
From: Bryan Caplan [mailto:[EMAIL PROTECTED]]
Sent: Thursday, October 05, 2000 10:04 AM
To: [EMAIL PROTECTED]
Subject: Re: Card/Krueger Revisited


Alexander Robert William Robson wrote:

> Isn't one of the most important parts of doing "quality" empirical work
> the proper collection of data?  Hasn't it been  estabished that
> the C-K failed this test miserably?

Other than the circular argument that "they didn't collect data properly
because the results came out wrong," what's so bad about their data
collection.  Yes, they used telephone interviews, and these aren't
perfect, but their method wasn't worse than usual.  Also they actually
sent people to do live interviews and non-respondents and to record
restaurant closings.  One more serious complaint is that they gathered
info on number of full and part-time employees, but not employee hours.
That's true, but it also would have been very hard to get an answer to
that question over the phone with a busy manager.

When I put the C/K study in the 90th percentile of quality for published
empirical work, I don't mind if you take that as a left-handed
compliment.  But I don't see how they failed "miserably" even then.

--
            Prof. Bryan Caplan               [EMAIL PROTECTED]   
            http://www.gmu.edu/departments/economics/bcaplan

  "We may be dissatisfied with television for two quite different
   reasons: because our set does not work, or because we dislike
   the program we are receiving.  Similarly, we may be dissatisfied
   with ourselves for two quite different reasons: because our body
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   conduct (mental illness)."
                   --Thomas Szasz, *The Untamed Tongue*