Explaining the Passage of Living Wage Legislation in the U.S.

Using data from various sources to describe 1,077 U.S. cities, I examine the adoption of living wage legislation between 1995 and 2006. I analyze both the decisions to adopt such legislation and the timing of such decisions. My principal finding is that, while the size and political identity of the community play a significant role, the adoption of living wage legislation is also significantly influenced by local economic circumstances. An important implication is that researchers who seek to measure the economic impacts of the legislation must allow for its endogeneity, in order to separate its economic effect(s) from its economic cause(s).