ECON 0210 week 8.2: How do minimum wage increases affect employment?

This week, we’re going think about internal and external validity in study design. We’ll also think a bit about how statistical evidence can inform theory and vice versa! (Internal validity: does the study make sense on its own terms, i.e. is it a true statement about the sample it studies? External validity: can we generalize the results of the study beyond the sample it looks at?)

Discuss the following questions as a group.

1. How do Card and Krueger design their study to learn about how minimum wage increases affect wages and unemployment? What did they find?
2. What are the key confounding variables Card and Krueger worry about? Which do you think might be the biggest issue?
3. Are there other confounders you would worry about that you didn’t see mentioned?