The Living Wage: How Effective is it?

Abstract

The first living wage ordinance was passed in Baltimore in 1994. Since then over 100 cities have adopted similar living wage laws in an attempt to reduce urban poverty. This report looks at an actual campaign case study. More research is needed to verify assumptions made by both opponents and proponents of living wage ordinances. A brief survey of the Living Wage is given for the purpose of deriving meaning, need, and motivation behind the modem living wage movement. After examination of different living wage sources of data and analysis this study determined that the future effectiveness of a particular living wage ordinance cannot be accurately determined by living wage proposal analyses because they tend to reflect the bias of the author. A more practical measure of the policy's effectiveness in reducing poverty is provided for in empirical analyses of cities with living wages and cities without living wages. The conclusions drawn from these analyses are reflections of the very short run at best and more study will be necessary to determine the ultimate success or failure of this method of poverty reduction.