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  1. Wages, minimum wages, and price pass-through: the case of McDonald's restaurants
    Autor*in: Ashenfelter, Orley; Jurajda, Štěpán
    Erschienen: February 2021
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    We use price and wage data from McDonald's restaurants to provide evidence on wage increases, labor-saving technology introduction, and price pass-through by a large low-wage employer facing a flurry of minimum wage hikes from 2016-2020. We estimate... mehr

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    We use price and wage data from McDonald's restaurants to provide evidence on wage increases, labor-saving technology introduction, and price pass-through by a large low-wage employer facing a flurry of minimum wage hikes from 2016-2020. We estimate an elasticity of hourly wage rates with respect to minimum wages of 0.7. In 40% of instances where minimum wages increase, McDonald's restaurants' wages are near the effective minimum wage level both before and after its increase; however, we also uncover a tendency among a large subset of restaurants to preserve their pay 'premium' above the minimum wage level. We find no association between the adoption of labor-saving touch screen ordering technology and minimum wage hikes. Our data imply that McDonald's restaurants pass through the higher costs of minimum wage increases in the form of higher prices of the Big Mac sandwich. We find a 0.2 price elasticity with respect to wage increases, which implies an elasticity of prices with respect to minimum wages of about 0.14. Based on a listing of all US McDonald's restaurants from 2010 to 2020, we also find no effects of minimum wages on McDonald's restaurant entry and exit.

     
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    hdl: 10419/232876
    Schriftenreihe: Discussion paper series / IZA ; no. 14124
    Schlagworte: minimum wages; fast food; price pass-through
    Umfang: 1 Online-Ressource (circa 32 Seiten), Illustrationen
  2. The rational of minimum wages
    Autor*in: Herr, Hansjörg
    Erschienen: 03/2021
    Verlag:  kassel university press, Kassel, Germany

    Leaving labour markets to the market mechanism with flexible wages is the worst thing that can happen as the result would be a permanent destabilisation of the price level and an explosion of inequality—both of which adds to the instabilities of... mehr

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    Leaving labour markets to the market mechanism with flexible wages is the worst thing that can happen as the result would be a permanent destabilisation of the price level and an explosion of inequality—both of which adds to the instabilities of capitalism. Guarantee of minimum wages can play an important role to contain the destabilising potential of labour markets. They can add to the stability of price level development and help establish a type of wage dispersion preferred by society. Minimum wages do not lead to unemployment. Countries with very high wage dispersion can have high unemployment while those with low wage dispersion might ensure full employment. Looking at the distribution effect, minimum wage increases (which compress the wage structure from below) not only lead to redistribution within wage earners, but also can increase wage shares. Minimum wage policy should play an important and active role in macroeconomic management of an economy which in turn is linked with macroeconomic demand management so that the employment rate is maintained high.

     
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    ISBN: 9783737609296
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    Schriftenreihe: ICDD Working Papers ; no. 35 (March 2021)
    Schlagworte: income distribution; labour market; Keynesian paradigm; minimum wages; monopsony; wage dispersion
    Umfang: 1 Online-Ressource (circa 34 Seiten), Illustrationen
  3. The gap that survived the transition
    the gender wage gap over three decades in Estonia
    Autor*in: Meriküll, Jaanika; Tverdostup, Maryna
    Erschienen: August 2021
    Verlag:  Wiener Institut für Internationale Wirtschaftsvergleiche, Wien

    This paper looks at the gender wage gap throughout the transition from communism to capitalism and throughout a time of rapid economic convergence. The case of Estonia is used, and micro data from the Labour Force Survey from 1989 to 2020 are... mehr

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    This paper looks at the gender wage gap throughout the transition from communism to capitalism and throughout a time of rapid economic convergence. The case of Estonia is used, and micro data from the Labour Force Survey from 1989 to 2020 are employed. The communist regimes had highly regulated wage setting and high levels of educational attainment and labour market participation for women. Although the regime was formally egalitarian, the gender attitudes were conservative and the raw gender wage gap was as large as 41% at the end of the communist period in Estonia. The large gender wage gap under communist rule narrowed quickly during the first years of economic transition, but the further decline in the gap has been slow. The paper has two main messages. The first is that there is strong inertia in the gender wage gap persisting through the communist period and economic convergence. None of the known long-run cultural drivers of gender attitudes can explain this. The second is that the decline in the gap is related to the overall decline in wage inequality, the rise in minimum wages, and more egalitarian gender attitudes. The gender attitudes are responsible for a smaller effect than wage inequality is.

     
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    hdl: 10419/240649
    Schriftenreihe: Working paper / wiiw ; 206
    Schlagworte: gender wage gap; wage distribution; decomposition; post-communist economies; wage inequality; minimum wages; gender attitudes
    Umfang: 1 Online-Ressource (circa 42 Seiten), Illustrationen
  4. The heterogeneous effects of large and small minimum wage changes: evidence over the short and medium run using a pre-analysis plan
    Autor*in: Clemens, Jeffrey; Strain, Michael R.
    Erschienen: September 2021
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    This paper advances the use of pre-analysis plans in non-experimental research settings. In a study of recent minimum wage changes, we demonstrate how analyses of medium- and long-run impacts of policy interventions can be pre-specified as extensions... mehr

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    This paper advances the use of pre-analysis plans in non-experimental research settings. In a study of recent minimum wage changes, we demonstrate how analyses of medium- and long-run impacts of policy interventions can be pre-specified as extensions to short-run analyses. Further, our pre-analysis plan includes comparisons of the effects of large vs. small minimum wage increases, which is a theoretically motivated dimension of heterogeneity. We discuss how these use cases harness the strengths of pre-analysis plans while mitigating their weaknesses. This project's initial analyses explored CPS and ACS data from 2011 through 2015. Alongside these analyses, we pre-committed to analyses incorporating CPS and ACS data extending through 2019. Averaging across the specifications in our pre-analysis plan, we estimate that relatively large minimum wage increases reduced employment rates among low-skilled individuals by just over 2.5 percentage points. Our estimates of the effects of relatively small minimum wage increases vary across data sets and specifications but are, on average, both economically and statistically indistinguishable from zero. We estimate that medium-run effects exceed short-run effects and that the elasticity of employment with respect to the minimum wage is substantially more negative for large minimum wage increases than for small increases.

     
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    hdl: 10419/245798
    Schriftenreihe: Discussion paper series / IZA ; no. 14747
    Schlagworte: minimum wages; employment; pre-commitment
    Umfang: 1 Online-Ressource (circa 98 Seiten), Illustrationen
  5. Minimum wages, labor market institutions, and the distribution of earnings in Iran
    Autor*in: Karshenas, Massoud
    Erschienen: [2021]
    Verlag:  Economic Research Forum (ERF), Dokki, Giza, Egypt

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    Schriftenreihe: ERF working papers series ; no. 1478 (August 2021)
    Schlagworte: minimum wages; labour market institutions; inequality; rentier economies
    Umfang: 1 Online-Ressource (circa 40 Seiten), Illustrationen
  6. The gap that survived the transition:the gender wage gap over three decades in Estonia
    Autor*in: Meriküll, Jaanika; Tverdostup, Maryna
    Erschienen: 2021
    Verlag:  Eesti Pank, Tallinn

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    ISBN: 9789949606863
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    Schriftenreihe: Working paper series / Eesti Pank ; 2021, 4
    Schlagworte: gender wage gap; wage distribution; decomposition; post-communist economies; wage inequality; minimum wages; gender attitudes
    Umfang: 1 Online-Ressource (circa 40 Seiten), Illustrationen
  7. Living wages and age discontinuities for low-wage workers
    Autor*in: Datta, Nikhil; Machin, Stephen
    Erschienen: [2021]
    Verlag:  Centre for Economic Performance, London School of Economics and Political Science, London

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    Schriftenreihe: Discussion paper / Centre for Economic Performance ; no. 1803 (September 2021)
    Schlagworte: living wages; minimum wages; wages; hours
    Umfang: 1 Online-Ressource (circa 34 Seiten), Illustrationen
  8. Minimum wages and the China syndrome: causal evidence from US local labor markets
    Autor*in: Milsom, Luke; Roland, Isabelle
    Erschienen: [2021]
    Verlag:  Centre for Economic Performance, London School of Economics and Political Science, London

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    Schriftenreihe: Discussion paper / Centre for Economic Performance ; no. 1807 (October 2021)
    Schlagworte: import penetration; labor market institutions; minimum wages; manufacturing employment
    Umfang: 1 Online-Ressource (circa 33 Seiten), Illustrationen
  9. Adverse working conditions and immigrants' physical health and depression outcomes: a longitudinal study in Greece
    Autor*in: Drydakis, Nick
    Erschienen: August 2021
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    The study examines whether adverse working conditions for immigrants in Greece bear an association with deteriorated physical health and increased levels of depression during 2018 and 2019. Findings indicate that workers with no written contract of... mehr

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    The study examines whether adverse working conditions for immigrants in Greece bear an association with deteriorated physical health and increased levels of depression during 2018 and 2019. Findings indicate that workers with no written contract of employment, receiving hourly wages lower than the national hourly minimum wages, and experiencing insults and/or threats in their present job experience worse physical health and increased levels of depression. The study found that the inexistence of workplace contracts, underpayment, and verbal abuse in the workplace may coexist. An increased risk of underpayment and verbal abuse reveals itself when workers do not have a contract of employment and vice versa. Immigrant workers without a job contract might experience a high degree of workplace precariousness and exclusion from health benefits and insurance. Immigrant workers receiving a wage lower than the corresponding minimum potentially do not secure a living income, resulting in unmet needs and low investments in health. Workplace abuse might correspond with vulnerability related to humiliating treatment. These conditions can negatively impact workers' physical health and foster depression. Policies should promote written employment contracts and ensure a mechanism for workers to register violations of fair practices.

     
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    hdl: 10419/245751
    Schriftenreihe: Discussion paper series / IZA ; no. 14700
    Schlagworte: adverse working conditions; physical health; depression; immigrants; refugees; minimum wages; written contracts of employment; threats in job; workplace precariousness
    Umfang: 1 Online-Ressource (circa 38 Seiten), Illustrationen
  10. Wage determination and the bite of collective contracts in Italy and Spain
    evidence from the metal working industry
    Autor*in: Adamopoulou, Effrosyni; Villanueva, Ernesto
    Erschienen: 2020
    Verlag:  Banco de España, Madrid

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    Schriftenreihe: Documentos de trabajo / Banco de España, Eurosistema ; no. 2036
    Schlagworte: minimum wages; collective contracts; Social Security data; spot market; explicit contracts; wage cyclicalit
    Umfang: 1 Online-Ressource (circa 64 Seiten), Illustrationen
  11. The changing distribution of the male ethnic wage gap in Great Britain
    Autor*in: Clark, Kenneth; Nolan, Steven P.
    Erschienen: April 2021
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    We decompose the ethnic pay gap in Great Britain across the distribution of hourly wages, yielding a detailed insight into differences between groups and how these vary over pay percentiles and through time. While some groups experience reductions in... mehr

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    We decompose the ethnic pay gap in Great Britain across the distribution of hourly wages, yielding a detailed insight into differences between groups and how these vary over pay percentiles and through time. While some groups experience reductions in the pay gap consistent with lower discrimination, including relatively well paid Indian workers and relatively poorly paid Bangladeshis, others - specifically Black groups - face an apparent glass ceiling barring access to well paid jobs. The increasing educational attainment of Britain's ethnic groups provides some optimism around narrowing pay differentials, particularly at the top of the distribution, while the introduction and uprating of the National Minimum/Living Wage has contributed to improvements at the lower end.

     
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    hdl: 10419/236307
    Schriftenreihe: Discussion paper series / IZA ; no. 14276
    Schlagworte: ethnic pay gap; race discrimination; minimum wages; decomposition
    Umfang: 1 Online-Ressource (circa 58 Seiten), Illustrationen
  12. Minimum wages and insurance within the firm
    Autor*in: Adamopoulou, Effrosyni; Manaresi, Francesco; Rachedi, Omar; Yurdagul, Emircan
    Erschienen: December 2021
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    Minimum wages alter the allocation of firm-idiosyncratic risk across workers. To establish this result, we focus on Italy, and leverage employer-employee data matched to firm balance sheets and hand-collected wage floors. We find a relatively larger... mehr

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    Minimum wages alter the allocation of firm-idiosyncratic risk across workers. To establish this result, we focus on Italy, and leverage employer-employee data matched to firm balance sheets and hand-collected wage floors. We find a relatively larger pass-through of firm-specific labor-demand shocks into wages for the workers whose earnings are far from the floors, but who are employed by establishments intensive in minimum-wage workers. We study the welfare implications of this fact using an incomplete-market model. The asymmetric passthrough uncovers a novel channel which tilts the benefits of removing minimum wages toward high-paid employees at the expense of low-wage workers.

     
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    hdl: 10419/250604
    Schriftenreihe: Discussion paper series / IZA ; no. 14943
    Schlagworte: firm-specific shocks; pass-through; minimum wages; linked employer-employee data; general equilibrium; complementarities
    Umfang: 1 Online-Ressource (circa 48 Seiten), Illustrationen
  13. Minimum wages in developing countries
    Autor*in: Fang, Tony; Viet Hoang Ha
    Erschienen: May 2022
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    There is considerable debate on the level and effects of minimum wages for many decades. However, most of the studies are conducted in developed countries. This chapter first reviews the theoretical frameworks of anticipated effects of a minimum wage... mehr

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    There is considerable debate on the level and effects of minimum wages for many decades. However, most of the studies are conducted in developed countries. This chapter first reviews the theoretical frameworks of anticipated effects of a minimum wage increase on wages and employment in developing countries. The empirical challenges are then discussed, including potential heterogeneity, simultaneity (or endogeneity) between employment and minimum wages, and possible omitted variable bias, taking into consideration of the different labour market structures and labour market institutions in developing countries, particularly the level of informal sector, extent of binding minimum wages, level of enforcement, and the vulnerability of the workers impacted. Evidence from BRICS members (Brazil, Russia, India, China, and South Africa) are reviewed and discussed. Surprisingly, there is substantial evidence of positive wage effects in both formal and informal sectors, although the adverse effects on employment are generally modest in the formal sector, and almost non-existent in the informal sector. However, when minimum wages are binding and enforced, studies focusing on vulnerable workers do find significant and positive wage effects and strong disemployment effects, implying that the classic trade-off of minimum wages between higher wages and lower employment does occur in developing countries.

     
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    hdl: 10419/263556
    Schriftenreihe: Discussion paper series / IZA ; no. 15340
    Schlagworte: minimum wages; labour market outcomes; developing countries
    Umfang: 1 Online-Ressource (circa 36 Seiten), Illustrationen
  14. Minimum wages and the China syndrome
    causal evidence from US local labor markets
    Autor*in: Milsom, Luke; Roland, Isabelle
    Erschienen: [2021]
    Verlag:  University of Cambridge, Faculty of Economics, Cambridge

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    Schriftenreihe: Cambridge working paper in economics ; 2170
    Schlagworte: Import penetration; labor market institutions; minimum wages; manufacturing employment
    Umfang: 1 Online-Ressource (circa 31 Seiten), Illustrationen
  15. Minimum wages and the rise in solo self-employment
    Autor*in: Ganserer, Angelika; Gregory, Terry; Zierahn-Weilage, Ulrich
    Erschienen: [2022]
    Verlag:  ZEW - Leibniz Centre for European Economic Research, Mannheim, Germany

    Solo self-employment is on the rise despite less favorable working conditions compared to traditional jobs. We show that the introduction of minimum wages in German industries led to an increase in the share of solo self-employment by up to 8.5... mehr

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    Solo self-employment is on the rise despite less favorable working conditions compared to traditional jobs. We show that the introduction of minimum wages in German industries led to an increase in the share of solo self-employment by up to 8.5 percentage points. We explain our findings within a substitution-scale model that predicts a decline in demand and earnings perspectives for high-skilled dependent workers, whenever the negative scale effect (overall decline in industry employment) dominates the positive substitution effect (shift towards high-skilled workers). Such situations can occur during an economic downturn in combination with a strong and rising minimum wage bite.

     
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    hdl: 10419/261376
    Schriftenreihe: Discussion paper / ZEW ; no. 22, 024 (07/2022)
    Schlagworte: minimum wages; solo self-employment; synthetic control method
    Umfang: 1 Online-Ressource (53 Seiten), Illustrationen
  16. Minimum wages and restaurant employment for teens and adults in metropolitan and non-metropolitan areas
    Autor*in: Winters, John V.
    Erschienen: August 2022
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    This study estimates effects of minimum wages on individual restaurant employment using the 2005-2019 Current Population Survey (CPS) and a two-way fixed effects regression model. I examine effects for teens and adults with less than an associate's... mehr

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    This study estimates effects of minimum wages on individual restaurant employment using the 2005-2019 Current Population Survey (CPS) and a two-way fixed effects regression model. I examine effects for teens and adults with less than an associate's degree for the entire U.S. and by metropolitan area status. The results indicate that minimum wages on average decrease restaurant employment for teens and increase restaurant employment for these adults, suggesting that minimum wages induce labor-labor substitution. However, this pattern is driven by metropolitan areas residents. The estimated coefficient for minimum wages on teen restaurant employment in non-metropolitan areas is not statistically significant.

     
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    hdl: 10419/265720
    Schriftenreihe: Discussion paper series / IZA ; no. 15499
    Schlagworte: minimum wages; restaurants; employment; teens
    Umfang: 1 Online-Ressource (circa 41 Seiten)
  17. Labor market frictions and spillover effects from publicly announced sectoral minimum wages
    Autor*in: Demir, Gökay
    Erschienen: 2022
    Verlag:  RWI - Leibniz-Institut für Wirtschaftsforschung, Essen, Germany

    I analyze the spillover effects of publicly announced sectoral minimum wages in Germany. My identification strategy exploits exposure to sectoral minimum wages across workers and industries outside the minimum wage sector in a triple differences... mehr

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    I analyze the spillover effects of publicly announced sectoral minimum wages in Germany. My identification strategy exploits exposure to sectoral minimum wages across workers and industries outside the minimum wage sector in a triple differences estimation. Subminimum wage workers in related industries outside of the minimum wage sector experience an increase in wages, job-to-job transitions, and reallocation from low-paying to high-paying establishments after the public announcement of Germany's first sectoral minimum wage. The reduction of information frictions, rather than the strategic interaction of employers, appears to be the main mechanism for these effects. When examining the spillover effects of other sectoral minimum wages from various contexts, I only discover positive spillover effects on sub-minimum wage workers in related industries outside the minimum wage sectors if the typical employment relationship in the minimum wage sector is comparable to that of the workers in my sample.

     
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    ISBN: 9783969731505
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    hdl: 10419/267742
    Schriftenreihe: Ruhr economic papers ; #985
    Schlagworte: Spillover; labor market frictions; minimum wages; information frictions
    Umfang: 1 Online-Ressource (circa 81 Seiten), Illustrationen
  18. Staggered contracts and unemployment during recessions
    Autor*in: Adamopoulou, Effrosyni; Díez-Catalán, Luis; Villanueva, Ernesto
    Erschienen: December 2022
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    This paper studies the impact of downward wage rigidity on wage dynamics and employment flows after the outbreak of major recessions over the last 30 years in Spain. Downward wage rigidity stems from collective agreements, which set... mehr

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    This paper studies the impact of downward wage rigidity on wage dynamics and employment flows after the outbreak of major recessions over the last 30 years in Spain. Downward wage rigidity stems from collective agreements, which set province-industry-skill specific minimum wage floors for all workers. We show that agreements signed after the onset of the 1993 and 2009 recessions settled on average for a 1.0-1.5 pp lower nominal wage growth than the agreements signed before. By exploiting variation in the renewal of collective contracts and leveraging Social Security data and the distribution of the worker-level bite of minimum wage floors, we find that in both recessions actual wage growth was indeed higher among workers covered by collective contracts signed during expansions and with wages close to the floors. However, employment responses vary across recessions. In the low-inflation recession of 2009, job losses are highly persistent and entirely driven by workers with pre-recession wages close to the minimum wage floors while in the high inflation recession of 1993, job losses were limited and short-lived. Using Labour Force Survey data in a similar setting we find that downward wage rigidity during the first year of the COVID-19 pandemic triggered adjustments at the intensive margin of labor (short time work). Our findings highlight the interplay between rigidity at different parts of the wage distribution, macroeconomic environment and labor market institutions and identify conditions under which collective contract staggering and the inability to renegotiate may amplify aggregate shocks.

     
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    hdl: 10419/272428
    Schriftenreihe: Discussion paper series / IZA ; no. 15801
    Schlagworte: labor demand; collective bargaining; wage rigidity; staggering; minimum wages; social security data; inflation
    Umfang: 1 Online-Ressource (circa 69 Seiten), Illustrationen
  19. Minimum wages in New Zealand: policy and practice in the 21st century
    Autor*in: Maré, David C.; Hyslop, Dean Robert
    Erschienen: April 2021
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    New Zealand has seen dramatic changes in minimum wage policies since 2000. The adult minimum wage has increased 75% in CPI-adjusted real terms. In addition, the youth minimum wage was abolished in two stages, resulting in a 125% increase in the real... mehr

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    New Zealand has seen dramatic changes in minimum wage policies since 2000. The adult minimum wage has increased 75% in CPI-adjusted real terms. In addition, the youth minimum wage was abolished in two stages, resulting in a 125% increase in the real minimum wage for 16-19-year-old workers. We review the motivations for minimum wages and the changes and analyse how they have affected workers outcomes. We find that the minimum wage now strongly determines the wages of teenage workers, with the minimum wage now at the median wage of teenagers, and over half of 16-17-year-olds, and about 40% of 18-19-year-olds, earning at or below the minimum. Although we find no clear evidence that increases in the minimum wage have led to adverse employment effects, we expect there are downside risks for youth and low skilled workers' employment. As minimum wage workers are broadly spread across the household income distribution, we conclude that minimum wages are largely ineffective as a redistributive income support policy.

     
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    hdl: 10419/236333
    Schriftenreihe: Discussion paper series / IZA ; no. 14302
    Schlagworte: minimum wages; employment; earnings inequality; income inequality
    Umfang: 1 Online-Ressource (circa 79 Seiten), Illustrationen
  20. Minimum wages and the rise in solo self-employment
    Autor*in: Ganserer, Angelika; Gregory, Terry; Zierahn-Weilage, Ulrich
    Erschienen: May 2022
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    Solo self-employment is on the rise despite less favorable working conditions compared to traditional jobs. We show that the introduction of minimum wages in German industries led to an increase in the share of solo self-employment by up to 8.5... mehr

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    Solo self-employment is on the rise despite less favorable working conditions compared to traditional jobs. We show that the introduction of minimum wages in German industries led to an increase in the share of solo self-employment by up to 8.5 percentage points. We explain our findings within a substitution-scale model that predicts a decline in demand and earnings perspectives for high-skilled dependent workers, whenever the negative scale effect (overall decline in industry employment) dominates the positive substitution effect (shift towards high-skilled workers). Such situations can occur during an economic downturn in combination with a strong and rising minimum wage bite.

     
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    hdl: 10419/263499
    Schriftenreihe: Discussion paper series / IZA ; no. 15283
    Schlagworte: minimum wages; solo self-employment; synthetic control method
    Umfang: 1 Online-Ressource (circa 57 Seiten), Illustrationen
  21. The minimum wage, turnover, and the shape of the wage distribution
    Autor*in: Brochu, Pierre; Green, David A.; Lemieux, Thomas; Townsend, James
    Erschienen: October 2023
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    This paper proposes an empirical approach to decompose the distributional effects of minimum wages into effects for workers moving out of employment, workers moving into employment, and workers continuing in employment. We estimate the effects of the... mehr

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    This paper proposes an empirical approach to decompose the distributional effects of minimum wages into effects for workers moving out of employment, workers moving into employment, and workers continuing in employment. We estimate the effects of the minimum wage on the hazard rate for wages, which provides a convenient way of re-scaling the wage distribution to control for possible employment effects. We find that minimum wage increases do not result in an abnormal concentration of Job Leavers below the new minimum wage, which is inconsistent with employment effects predicted by a neoclassical model. We also find that, for Job Stayers, the spike and spillover effects of the minimum wage are simply shifted right to the new minimum wage. Our findings are consistent with a model where entry wages are set according to a job ladder, and where firms preserve their internal wage structure due to fairness or internal incentives issues.

     
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    hdl: 10419/282641
    Schriftenreihe: Discussion paper series / IZA ; no. 16514
    Schlagworte: Mindestlohn; Verteilungswirkung; Arbeitsmobilität; Lohnstruktur; Beschäftigungseffekt; Dekompositionsverfahren; Kanada; minimum wages; wage distribution
    Umfang: 1 Online-Ressource (circa 65 Seiten), Illustrationen
  22. Labor market frictions and spillover effects from publicly announced sectoral minimum wages
    Autor*in: Demir, Gökay
    Erschienen: June 2023
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    This paper analyzes the spillover effects of the first sectoral minimum wage in Germany. Using a triple differences estimation, the study examines the impact of public discussion and announcement of the minimum wage on workers and industries outside... mehr

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    This paper analyzes the spillover effects of the first sectoral minimum wage in Germany. Using a triple differences estimation, the study examines the impact of public discussion and announcement of the minimum wage on workers and industries outside the minimum wage sector. The results show that the public discussion and announcement led to an increase in wages, job-to-job transitions and reallocation from low-paying to high-paying establishments among sub-minimum wage workers in similar jobs outside the minimum wage sector. The main mechanism for these effects appears to be the reduction of information frictions, rather than strategic interaction of employers.

     
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    Schriftenreihe: Discussion paper series / IZA ; no. 16204
    Schlagworte: spillover; labor market frictions; minimum wages; information frictions
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  23. Minimum wages and changing wage inequality in India
    Autor*in: Khurana, Saloni; Mahajan, Kanika; Sen, Kunal
    Erschienen: November 2023
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    Using nationally representative data on employment and earnings, this paper documents a fall in wage inequality in India over the last two decades. It then examines the role played by increasing minimum wages for the lowest skilled workers in India... mehr

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    Using nationally representative data on employment and earnings, this paper documents a fall in wage inequality in India over the last two decades. It then examines the role played by increasing minimum wages for the lowest skilled workers in India in contributing to the observed decline. Exploiting regional variation in changes in minimum wages over time in the country, we find that an increase in minimum wages by one percent led to an increase in wages for workers in the lowest quintile by 0.17%. This effect is smaller at upper wage quintiles and insignicant for the highest wage quintile. Counterfactual wage estimations show that the increase in minimum wages explains 26% of the decline in wage inequality in India during 1999-2018. These findings underscore the important role played by rising minimum wages in reducing wage disparities in India.

     
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    hdl: 10419/282727
    Schriftenreihe: Discussion paper series / IZA ; no. 16600
    Schlagworte: minimum wages; wage inequality; India
    Umfang: 1 Online-Ressource (circa 70 Seiten), Illustrationen
  24. Minimum wage non-compliance
    the role of co-determination
    Autor*in: Goerke, Laszlo; Pannenberg, Markus
    Erschienen: November 2023
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    We analyse in what way co-determination affects non-compliance with the German minimum wage, which was introduced in 2015. The Works Constitution Act (WCA), the law regulating co-determination at the plant level, provides works councils with indirect... mehr

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    We analyse in what way co-determination affects non-compliance with the German minimum wage, which was introduced in 2015. The Works Constitution Act (WCA), the law regulating co-determination at the plant level, provides works councils with indirect means to ensure compliance with the statutory minimum wage. Based on this legal situation, our theoretical model predicts that non-compliance is less likely in co-determined firms because works councils enhance the enforcement of the law. The economic correlates of co-determination, such as higher productivity and wages, affect non-compliance in opposite directions. The empirical analysis, using data from the German Socio-economic Panel (SOEP) for the years 2016 and 2019, demonstrates that non-compliance occurs less often for employees in co-determined establishments, while there is no impact on the difference between the minimum wage and the amount, which was actually paid. Therefore, co-determination helps to secure the payment of minimum wages.

     
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    hdl: 10419/282748
    Schriftenreihe: Discussion paper series / IZA ; no. 16621
    Schlagworte: co-determination; labour law; minimum wages; Socioeconomic Panel (SOEP); non-compliance; works councils
    Umfang: 1 Online-Ressource (circa 38 Seiten)
  25. The impact of a minimum wage increase on hours worked
    heterogeneous effects by gender and sector
    Autor*in: Redmond, Paul; McGuinness, Séamus
    Erschienen: March 2023
    Verlag:  IZA - Institute of Labor Economics, Bonn, Germany

    A minimum wage increase could lead to adverse employment effects for certain sub-groups of minimum wage workers, while leaving others unaffected. This heterogeneity could be overlooked in studies that examine the overall population of minimum wage... mehr

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    A minimum wage increase could lead to adverse employment effects for certain sub-groups of minimum wage workers, while leaving others unaffected. This heterogeneity could be overlooked in studies that examine the overall population of minimum wage workers. In this paper, we test for heterogeneous effects of a minimum wage increase on the hours worked of minimum wage employees in Ireland. For all minimum wage workers, we find that a ten percent increase in the minimum wage leads to a one-hour reduction in weekly hours worked, equating to an hours elasticity of approximately -0.3. However, for industry workers and those in the accommodation and food sector, the impact is larger, with an elasticity of -0.8. We also find a negative impact on the hours worked among men on minimum wage, with no significant effect for women. In line with suggestions from the recent literature, our study uses administrative wage data to accurately identify those in receipt of minimum wage, while also studying the dynamic impact on hours worked over multiple time periods using a fully flexible difference-in-differences estimator.

     
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    hdl: 10419/272658
    Schriftenreihe: Discussion paper series / IZA ; no. 16031
    Schlagworte: minimum wages; heterogeneous effects; flexible difference-indifference
    Umfang: 1 Online-Ressource (circa 29 Seiten), Illustrationen