The effect of minimum wages on employment is highly disputed. The main questions in the literature are on how to deal with spatial heterogeneity and dynamics. We use statistical (multi-factor error models) and economic (political ideology as control variable) methods to address the first....

We measure labor market frictions using a strategy that bridges design-based and structuralapproaches: estimating an equilibrium search model using reduced-form minimum wageelasticities identified from border discontinuities and fitted with Bayesian and LIML methods.We begin by providing the...