Employment and distribution effects of the minimum wage

Fabian Slonimczyk () and Peter Skott

Journal of Economic Behavior & Organization, 2012, vol. 84, issue 1, 245-264

Abstract: This paper analyzes the effects of the minimum wage on wage inequality, relative employment and over-education. We show that over-education can be generated endogenously and that an increase in the minimum wage can raise both total and low-skill employment, and produce a fall in inequality. Evidence from the US suggests that these theoretical results are empirically relevant. The over-education rate has been increasing and our regression analysis suggests that the decrease in the minimum wage may have led to a deterioration of the employment and relative wage of low-skill workers.

Keywords: Minimum wage; Earnings inequality; Monopsony; Efficiency wage; Over-education (search for similar items in EconPapers)
JEL-codes: J31 J41 J42 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Related works:
Working Paper: Employment and Distribution Effects of the Minimum Wage (2012)
Working Paper: Employment and Distribution Effects of the Minimum Wage (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:84:y:2012:i:1:p:245-264

DOI: 10.1016/j.jebo.2012.03.005

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