Wage Inequality in Germany After the Minimum Wage Introduction PDF Download
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Author: Mario Bossler
Publisher:
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Languages : en
Pages :
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We revisit the development of monthly wages in Germany between 2000 and 2017. While wage inequality strongly increased during the first years of this period, it recently returned to its initial level, raising the question what the role of the German minimum wage introduction for this reversal is. We identify effects of the minimum wage from difference-in-differences based on unconditional quantile regressions applied to German administrative employment data. The results show significant wage effects of varying magnitudes along the lower half of the wage distribution. Employment dynamics do not explain effects along the wage distribution, implying strong wage increases among the existing workforce. The increased individual labor income is not offset by decreasing social benefits. Overall, the introduction of the minimum wage can account for about half of the recent decrease in wage inequality.
Author: Mario Bossler
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
We revisit the development of monthly wages in Germany between 2000 and 2017. While wage inequality strongly increased during the first years of this period, it recently returned to its initial level, raising the question what the role of the German minimum wage introduction for this reversal is. We identify effects of the minimum wage from difference-in-differences based on unconditional quantile regressions applied to German administrative employment data. The results show significant wage effects of varying magnitudes along the lower half of the wage distribution. Employment dynamics do not explain effects along the wage distribution, implying strong wage increases among the existing workforce. The increased individual labor income is not offset by decreasing social benefits. Overall, the introduction of the minimum wage can account for about half of the recent decrease in wage inequality.
Author: Marco Caliendo
Publisher:
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Category :
Languages : en
Pages :
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In 2015, Germany introduced a statutory hourly minimum wage that was not only universally binding but also set at a relatively high level. We discuss the short-run effects of this new minimum wage on a wide set of socio-economic outcomes, such as employment and working hours, earnings and wage inequality, dependent and selff-employment, as well as reservation wages and satisfaction. We also discuss diffculties in the implementation of the minimum wage and the measurement of its effects related to non-compliance and suitability of data sources. Two years after the minimum wage introduction, the following conclusions can be drawn: while hourly wages increased for low-wage earners, some small negative employment effects are also identifiable. The effects on aspired goals, such as poverty and inequality reduction, have not materialized in the short run. Instead, a tendency to reduce working hours is found, which alleviates the desired positive impact on monthly income. Additionally, the level of non-compliance was substantial in the short run, thus drawing attention to problems when implementing such a wide reaching policy.
Author: Niklas Schröder
Publisher:
ISBN:
Category :
Languages : en
Pages : 56
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Author: Kai Ingwersen
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Category :
Languages : en
Pages : 0
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This paper investigates the effects of the introduction of a statutory minimum wage in Germany on the wages and employment of migrants. Migrants are an overrepresented group in the low-wage sector and can be expected to particularly benefit from a minimum wage. We combine a "differential trend adjusted difference-in-differences estimator" (DTADD) and descriptive evidence to evaluate the impact of the minimum wage introduction in 2015 on hourly wages, monthly salaries, working hours and changes in employment and wage distribution. Contrary to expectations, our results show that the introduction of the minimum wage has weakened the position of migrants in the low-wage sector compared to their native counterparts. We observe an increase in part-time employment, a less pronounced decline in unemployment and a greater reduction in weekly working hours among migrants. The introduction of the minimum wage caused a temporary convergence in hourly wages between migrants and natives, which subsequently turned into a wage divergence. Migrant men in the low-wage sector have been particularly negatively affected by the introduction of the minimum wage. Moreover, increasing hourly wages have not translated into higher monthly salaries, thus widening wage inequality between migrants and natives.
Author: Ramona Schmid
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Languages : en
Pages : 0
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Author: Linda Wittbrodt
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Category :
Languages : en
Pages : 0
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On January 1, 2015, Germany introduced a general statutory minimum wage of €8.50 gross per hour. This thesis analyses the effects of the minimum wage introduction in Germany as well as wage floors in the European context, contributing to national and international research. The second chapter of this dissertation summarizes the short-run effects of the minimum wage reform found in previous studies. We show that the introduction of the minimum wage had a positive effect on wages at the bottom of the distribution. Yet, there was still a significant amount of non-compliance shortly after the reform. Additionally, previous evidence points to small negative employment effects mainly driven by a reduction in mini-jobs. Contrary to expectations, though, there were no effects on poverty and general inequality found in the short run. This is mostly due to the fact that working hours were reduced and the increase of hourly wages was therefore not reflected in monthly wages. The third chapter identifies whether the job losses ...
Author: Linda Wittbrodt
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
On January 1, 2015, Germany introduced a general statutory minimum wage of €8.50 gross per hour. This thesis analyses the effects of the minimum wage introduction in Germany as well as wage floors in the European context, contributing to national and international research. The second chapter of this dissertation summarizes the short-run effects of the minimum wage reform found in previous studies. We show that the introduction of the minimum wage had a positive effect on wages at the bottom of the distribution. Yet, there was still a significant amount of non-compliance shortly after the reform. Additionally, previous evidence points to small negative employment effects mainly driven by a reduction in mini-jobs. Contrary to expectations, though, there were no effects on poverty and general inequality found in the short run. This is mostly due to the fact that working hours were reduced and the increase of hourly wages was therefore not reflected in monthly wages. The third chapter identifies whether the job losses ...
Author: Kai-Uwe Müller
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Eduard Brüll
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Category :
Languages : en
Pages : 0
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We analyze the evolution of the wage structure in East Germany over the past two decades and compare it to West Germany. Both regions experienced a rise in wage inequality between 1995 and 2009 with wage dispersion in East Germany exceeding West Germany, esp. at the top. We also show that wage inequality is no longer rising in Germany and has even been declining in East Germany after 2009. Compositional changes of the workforce and selection along the employment margin play only a minor role as does the decline of union coverage for the rise in wage inequality. The adoption of minimum wages in selected industries, in contrast, explains all of the turnaround in East German wage inequality after 2009. Demand side changes seem to account for the rise in wage dispersion at the top.
Author: Patrick Emmenegger
Publisher: OUP USA
ISBN: 0199797897
Category : Business & Economics
Languages : en
Pages : 353
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Book Description
Poverty, increased inequality, and social exclusion are back on the political agenda in Western Europe, not only as a consequence of the Great Recession of 2008, but also because of a seemingly structural trend towards increased inequality in advanced industrial societies that has persisted since the 1970s. How can we explain this increase in inequalities? Policies in labor markets, social policy, and political representation are strongly linked in the creation, widening, and deepening of insider-outsider divides--a process known as dualization. While it is certainly not the only driver of increasing inequality, the encompassing nature of its development across multiple domains makes dualization one of the most important current trends affecting developed societies. However, the extent and forms of dualization vary greatly across countries. The comparative perspective of this book provides insights into why Nordic countries witness lower levels of insider-outsider divides, whereas in continental, liberal and southern welfare states, they are more likely to constitute a core characteristic of the political economy. Most importantly, the comparisons presented in this book point to the crucial importance of politics and political choice in driving and shaping the social outcomes of deindustrialization. While increased structural labor market divides can be found across all countries, governments have a strong responsibility in shaping the distributive consequences of these labor market changes. Insider-outsider divides are not a straightforward consequence of deindustrialization, but rather the result of political choice. A landmark publication, this volume is geared for faculty and graduate students of economics, political science, social policy, and sociology, as well as policymakers concerned with increasing inequality in a period of deep economic and social crisis.
