The role of beliefs in supporting economic policies: The case of the minimum wage

Using a sizeable online experiment on a proposed policy to raise the minimum wage in Quebec, we show that support for the policy is consistent with participants' self-interest and social preferences and, most importantly, with their beliefs about the policy's outcomes. This finding is significant because, unlike policy-invariant sociodemographic characteristics, beliefs can be modified. We then show that beliefs about the outcomes vary with participants' knowledge about the minimum wage, numeracy, and economic literacy. We also show how participants without a good knowledge of facts about the minimum wage (its actual level, its relation with the average wage, and the proportion of workers earning the minimum wage), change their opinion after having been informed with the correct information. (c) 2021 Elsevier B.V. All rights reserved.