The Impact of State Minimum Wages on Child Poverty in Female-Headed Families

Several state governments set minimum wage levels above the federal level, and some automatically index them to inflation. This article uses the variation in real minimum wages both over time and across states to examine how minimum wages have affected poverty rates of children living in female-headed households. These children are among the most vulnerable members of society and are increasingly likely to feel the impact of such policy actions due to the growing presence of their mothers in low-wage labor markets. Evidence based on state-level panel data for the years 1991 to 2002 shows that minimum wages have significantly reduced child poverty rates, after controlling for a number of other potentially relevant factors. These findings are robust to alternative measures of poverty, sample definition, estimation technique, and variable selection.