Do minimum wage laws affect those who are not covered? Evidence from agricultural and non-agricultural workers

Autoři: Maoyong Fan aff001;  Anita Alves Pena aff002
Působiště autorů: Department of Economics, Ball State University, Muncie, Indiana, United States of America aff001;  Department of Economics, Colorado State University, Fort Collins, Colorado, United States of America aff002
Vyšlo v časopise: PLoS ONE 14(10)
Kategorie: Research Article


Some employers are not obligated to pay at least minimum wages to all employees. U.S. farm employers comprise one of these groups. Employees of large farms and H-2A workers (lawfully admitted, nonimmigrant workers performing temporary or seasonal agricultural work) are protected by minimum wage legislation, while some migrant workers (often those paid piece rates) are exempt. U.S. agriculture also is characterized by a large percentage of unauthorized workers who may or may not earn above minimum wage. Following insights from dual labor market theory and from theories of the signaling capacity of the minimum wage, we compare labor market outcomes in the agricultural sector (where minimum wage coverage is limited) to low wage/skill non-agricultural sectors (where minimum wage coverage is more complete) nationally using data from the Current Population Survey. We then extend our analysis to a detailed state-level case study of agricultural workers in California using a representative survey of employed farm workers. Results suggest wage increases for covered workers that exceed those for uncovered workers, but insignificant differences in hours worked. This is the first study to our knowledge to examine the impacts of minimum wage coverage on agricultural workers relative to other workers for the U.S.

Klíčová slova:

Agricultural workers – Agriculture – California – Employment – Labor markets – Salaries – Minimum wage – Payment


1. U.S. Department of Labor, Employment Standards Administration, Wage and Hour Division, Fact Sheet #12: Agricultural Employment under the Fair Labor Standards Act (FLSA).

2. Bhaskar V, To T. Minimum Wages for Ronald McDonald Monopsonies: A Theory of Monopsonistic Competition. Econ J (London). 1999; 109(455): 190–203.

3. Burkhauser RV, Couch KA, Wittenburg DC. A Reassessment of the New Economics of the Minimum Wage. J Labor Econ. 2000; 18(4): 653–681.

4. Card D, Krueger AB. Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania. Am Econ Rev. 1994; 84(4): 772–793.

5. Card D, Krueger AB. Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania: Reply. Am Econ Rev. 2000; 90(5): 1397–1420.

6. Neumark D, Wascher W Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania: Comment. Am Econ Rev. 2000; 90(5): 1362–1396.

7. Zavodny M. The Effect of Minimum Wage on Employment and Hours. Labour Econ. 2000; 7: 729–750.

8. Dube A, Lester TW, Reich M. Minimum wage effects across state borders: Estimates using contiguous counties. Rev Econ Stat. 2010; 92(4): 945–964.

9. Boeri T, Garibaldi P, Ribeiro M. The lighthouse effect and beyond. Rev Income Wealth. 2011; 57: S54–S78.

10. Gardner B. Minimum Wages and the Farm Labor Market. Am J Agric Econ. 1972; 54(4): 473–476.

11. Lianos TP. Impact of Minimum Wages upon the Level and Composition of Agricultural Employment. Am J Agric Econ. 1972; 54(4): 477–484.

12. Mishra AK, Rezitis AN. The Effect of Technological Change on Demand and Supply of Hired Farm Workers in the United States. Journal of Agribusiness. 1998; 16(1): 23–42.

13. Sabia JJ. Identifying Minimum Wage Effects: New Evidence from Monthly CPS Data. Ind Relat (Berkeley). 2009; 48(2): 311–328.

14. Meer J, West J. Effects of the minimum wage on employment dynamics. J Hum Resour. 2015; 51(2): 500–522.

15. Montgomery JD. Equilibrium wage dispersion and interindustry wage differentials Q J Econ. 1991; 106(1): 163–179.

16. Cahuc P, Zylberberg A. Labor economics. 1st ed. Cambridge: MIT press; 2004.

17. Mincer J. Unemployment Effects of Minimum Wages. J Polit Econ. 1976; 84(4): S87–S104.

18. Tauchen GE. Some Evidence on Cross-Sector Effects of the Minimum Wage. J Polit Econ. 1981; 89(3): 529–547.

19. Souza PR, Baltar PE. Salário mínimo e taxa de salários no Brasil. Pesquisa e Planejamento Econômico. 1979; 9(3): 629–659.

20. Jones SR. Minimum wage legislation in a dual labor market. Eur Econ Rev. 1987; 31(6): 1229–1246.

21. Dickens WT, Lang K. A test of dual labor market theory. Am Econ Rev. 1985 75(4): 792–805.

22. Gowers R, Hatton TJ. The Origins and Early Impact of the Minimum Wage in Agriculture. Econ Hist Rev. 1997; 50(1): 82–103.

23. Gallasch HF. Minimum wages and the farm labor market. South Econ J. 1975; 41(3): 480–491.

24. Gilroy CL. The effects of the minimum wage on farm employment: a new model. Mon Labor Rev. 1982; 105(6): 47–51.

25. Moretti E, Perloff JM. Minimum Wage Laws Lower Some Agricultural Wages. Berkeley (CA): Institute for Research on Labor and Employment; 2000. Working Paper No. 84–00.

26. Buccola S, Li C, Reimer J. Minimum wages, immigration control, and agricultural labor supply. Am J Agric Econ. 2011; 94(2): 464–470.

27. Hill AE. The Minimum Wage and Productivity: A Case Study of California Strawberry Pickers. 2018. Available from

28. Addison JT, Blackburn ML, Cotti CD. The Effect of Minimum Wages on Labour Market Outcomes: County‐Level Estimates from the Restaurant‐and‐Bar Sector. Br J Ind Relat. 2012; 50(3), 412–435.

29. Neumark D, Wascher W. Does a higher minimum wage enhance the effectiveness of the Earned Income Tax Credit? Ind Labor Relat Rev. 2011; 64(4): 712–746.

30. Neumark D, Salas JMI, Wascher W. Revisiting the Minimum Wage—Employment Debate: Throwing Out the Baby with the Bathwater? Ind Labor Relat Rev. 2014; 67(3_suppl): 608–648.

31. Allegretto SA, Dube A, Reich M. Do minimum wages really reduce teen employment? Accounting for heterogeneity and selectivity in state panel data. Ind Relat (Berkeley). 2011; 50(2), 205–240.

32. Allegretto S, Dube A, Reich M, Zipperer B. Credible research designs for minimum wage studies: A response to Neumark, Salas, and Wascher. Ind Labor Relat Rev. 2017; 70(3): 559–592.

33. Neumark D, Wascher W. Employment effects of minimum and subminimum wages: panel data on state minimum wage laws. Ind Labor Relat Rev, 1992; 46(1): 55–81.

34. Orrenius PM, Zavodny M. The Effect of Minimum Wages on Immigrants’ Employment and Earnings. Ind Labor Relat Rev. 2008; 61(4): 544–563.

35. Pena AA. Poverty, Pay Basis, and Legal Status: The Case of U.S. Agriculture. Ind Relat (Berkeley). 2010; 49(3): 429–456.

36. Gabbard SM, Mines R, Perloff JM. A Comparison of the CPS and NAWS Surveys of Agricultural Workers. Berkeley (CA): Institute for Research on Labor and Employment; 1991. Working Paper No. 32–91.

37. Seiler E. Piece Rate Vs. Time Rate: The Effect of Incentives on Earnings. Rev Econ Stat. 1984; 66(3): 363–376.

38. Lazear EP. Performance Pay and Productivity. Am Econ Rev. 2000; 90(5): 1346–1361.

39. Gindling T, Terrell K. The Effect of Minimum Wages on Actual Wages in Formal and Informal Sectors in Costa Rica. World Dev. 2005; 33(11): 1905–1921.

40. Cadena BC. Recent immigrants as labor market arbitrageurs: Evidence from the minimum wage. J Urban Econ. 2014; 80: 1–12. doi: 10.1016/j.jue.2013.10.002 24999288

41. Gilbert A, Phimister E, Theodossiou I. The Potential Impact of the Minimum Wage in Rural Areas. Reg Stud. 2001; 35(8): 765–770.

Článek vyšel v časopise


2019 Číslo 10
Nejčtenější tento týden