Q&A: Limits of Minimum Wage Policy

Published April 3, 2026

In the Q&A, the focus shifts from wages to households and policy design. Neumark explains why minimum wage increases deliver limited benefits to poor families and why a substantial share of gains accrues to workers in middle-income households. Evidence from tax and price data shows that higher costs and employment losses are disproportionately borne by low-income consumers and small employers. By contrast, policies such as the Earned Income Tax Credit target poverty more directly while strengthening incentives to work, highlighting a persistent mismatch between policy goals and policy choice.

Check out more from David Neumark:

• Read "The Minimum Wage Is a Dead End" by David Neumark here.
• Read "Minimum Wages and Race Disparities" by David Neumark here.
• Read "Accounting for City Size, Minimum Wages Reduce Jobs Almost Everywhere" by David Neumark here.

Learn more about David Neumark here.

Recorded on August 14, 2025.

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The opinions expressed in this video are those of the authors and do not necessarily reflect the opinions of the Hoover Institution or Stanford University.

© 2026 by the Board of Trustees of Leland Stanford Junior University.