Do anti-sweatshop campaigns reduce employment?

No, say Ann Harrison and Jason Scorse in a new AER paper (ungated):

We find that anti-sweatshop campaigns led to large real wages increases for targeted enterprises. We also examine whether higher wages led these firms to cut employment or relocate elsewhere.

The results suggest that there were some costs in terms of reduced investment, falling profits, and increased probability of closure for smaller plants, but we fail to find significant effects on employment.

The strongest argument against a minimum wage is the consequent fall in employment. But what if that fall isn’t consequent? See Card and Krueger for the rich country research.