How is the Minimum Wage Shaping the Wage Distribution: Minimum Wage, Spillovers, and Wage Inequality in Portugal

MPRA Paper from University Library of Munich, Germany

Abstract: Over the last three decades, wage inequality and the importance of the minimum wage presented a nearly symmetric behavior in Portugal. Applying a semiparametric approach, this paper presents significant visual and quantitative evidence of how the MW structurally reshaped the wage distribution. The remarkable rise in the real MW of 2006-2019 explained virtually all of the decline in wage inequality, and 40% of the average wage growth, mostly driven by spillovers, which cascaded way above the minimum. The MW was most important for women, although spillovers were greater for men. Exploring the total-base wage differential also uncovered important new insights.

Keywords: labour economics; minimum wage; spillovers; wage inequality; wage distribution; counterfactual decomposition; distribution regression; rank regression; kernel density; reweighting (search for similar items in EconPapers)
JEL-codes: C14 D31 J31 J38 (search for similar items in EconPapers)
Date: 2021-12-17
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Citations: View citations in EconPapers (1)

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