A Comparison of Legislation on the Minimum Wage and Alternative Minimum Tax

• In Event: How Hard Times Affect Us

Abstract

To what extent is economic inequality caused by inaction (policy drift) versus upper-class influence? We compare two economic policies heavily affected by inaction because they are not indexed for inflation: the federal minimum wage and the alternative minimum tax (AMT). We find that Congress actively updated both policies for inflation during the 1970s, but since then the minimum wage has diminished in real terms while the AMT has been maintained for married couples.

Authors

• Gregory Koger, University of Miami

• Stefanie Marie Rodriguez