Cities are increasingly setting their own minimum wages, and this trend has accelerated sharply in recent years. While in 2010 there were only three cities with their own minimum wages exceeding the state or federal standard, by 2020 there were 42. This new phenomenon raises the question: is it desirable to have city-level variation in minimum wage polices? We discuss the main trade-offs emerging from local variation in minimum wage polices and evaluate their empirical relevance. First, we document what type of cities raise minimum wages, and we discuss how these characteristics can potentially impact the effectiveness of city-level minimum wage policies. Second, we summarize the evolving evidence on city-level minimum wage changes and provide some new evidence of our own. Early evidence suggests that the impact of the policy on wages and employment to date has been broadly similar to the evidence on state- and federal-level minimum wage changes. Overall, city-level minimum wages seem to be able to tailor the policy to the local economic environment without imposing substantial distortions in allocation of labor and businesses across locations.

中文翻译：

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城市限制：当地最低工资有什么作用？

城市越来越多地设定自己的最低工资，而且这一趋势近年来急剧加速。2010 年只有 3 个城市的最低工资超过州或联邦标准，而到 2020 年则有 42 个。这一新现象提出了一个问题：在城市层面的最低工资政策是否可取？我们讨论了最低工资政策的地方差异带来的主要权衡，并评估了它们的经验相关性。首先，我们记录了哪些类型的城市提高了最低工资，并讨论了这些特征如何可能影响城市最低工资政策的有效性。其次，我们总结了城市层面最低工资变化的不断演变的证据，并提供了一些我们自己的新证据。早期证据表明，迄今为止，该政策对工资和就业的影响与州和联邦最低工资变化的证据大致相似。总体而言，城市层面的最低工资似乎能够根据当地经济环境调整政策，而不会对跨地区的劳动力和企业分配造成严重扭曲。