The Role of the State in Balancing the Minimum Wage in Turkey and the USA

In this article, the direct role of the state in industrial relations is scrutinized by focusing on the political basis of decisions regarding the minimum wage. We argue that in order to ensure stability and growth, any state must balance the interests of capital and labour when taking this kind of distributional decision. This idea is operationalized using O'Connor's concepts of accumulation and legitimation as the basis for an analytical model. Application to Turkey and comparison with the USA reveals that in Turkey, governments take account of legitimacy concerns in their minimum wage decisions due to the large number of workers directly dependent on minimum wages and weak collective bargaining institutions. In the USA, despite rather similar industrial relations conditions, this tendency is not present, probably due to the much smaller number of minimum wage earners and their weakness in the political process. However, in the USA, too, we observe that there is a difference between political parties and historical periods in the way in which the minimum wage is determined.     

Minimum Wages and Collective Bargaining: What Types of Pay Bargaining Can Foster Positive Pay Equity Outcomes?

Using data from interviews and collective agreements in five European countries, this article analyses the relationship between collective bargaining and the minimum wage. In a context of changing minimum wage policy and competing government objectives, the findings illuminate how pay bargaining strategies of trade unions and employers shape the pay equity effects of minimum wage policy. Two general forms are identified: direct responses to a changing national minimum wage, and responses to the absence or weakness of a national minimum wage. The article explains how particular intersections of minimum wage policy and collective bargaining, together with country and sector contingencies, shape the form of pay bargaining and pay equity outcomes.     

Minimum Wages,Employer‐Provided Health Insurance,and the Non‐discrimination Law

This article exploits cross‐state variation in minimum wages to investigate the impact of minimum wage changes on employer‐provided health insurance. In contrast to the existing empirical literature, this article considers an environment where some firms are constrained by non‐discrimination laws that govern the provision of health insurance. For these firms, minimum wage changes do not reduce the probability that workers will receive employer‐provided health insurance. For firms not covered by the non‐discrimination law, and free to tailor their fringe benefits, low‐skilled workers experience a disproportionate reduction in the availability and generosity of health insurance after a minimum wage increase.     

Promoting Labour Market Efficiency and Fairness through a Legal Minimum Wage: The Webbs and the Social Cost of Labour

Neoclassical economists, using a competitive demand/supply model of labour markets, typically conclude a legislated minimum wage is harmful to economic efficiency and social welfare. The major theoretical counter-attack by proponents of a minimum wage is to argue that low-wage labour markets are better modelled as monopsonistic. This article develops and formalizes a second theoretical defence for a legal minimum wage law. This defence rests on the concept of the social cost of labour , as originally popularized by Sidney and Beatrice Webb and then further developed by American institutional economists. This analysis is unique in that it continues to use the competitive demand/supply model but nonetheless demonstrates that a legislated minimum wage often simultaneously increases both economic efficiency and fairness, unlike the neoclassical prediction.     

Low Pay and Wage Regulation in the European Community

The prospect of direct intervention in the process of wage determination as envisaged in the Social Charter has met with considerable criticism. In particular, employers' organizations and certain governments have rejected outright the proposal to require firms to pay an equitable wage. However, in all member-states except the UK and Ireland, arrangements exist to ensure that nearly all workers are covered by minimum wage protection (through national minimum wages or full-coverage collective agreements). In this article the nature of low-paid employment in member-states is examined and different methods of wage regulation are described. After reviewing the economic effects of wage regulation, we discuss possible initiatives on wage regulation at the Community level.     

Are Minimum Wage Effects Greater in Low‐Wage Areas?

Empirical work on the minimum wage typically estimates effects averaged across high‐ and low‐wage areas. Low‐wage labor markets could potentially be less able to absorb minimum wage increases, in turn leading to more negative employment effects. In this article, we examine minimum wage effects in low‐wage counties, where relative minimum wage ratios reach as high as 0.82, well beyond the state‐based ratios in extant studies. Using data from the American Community Survey, the Quarterly Workforce Indicators, and the Quarterly Census on Employment and Wages, we implement event study and difference‐in‐differences methods, estimating average causal effects for all events in our sample and separately for areas with lower and higher impacts. We find positive wage effects, especially in high‐impact counties, but do not detect adverse effects on employment, weekly hours, or annual weeks worked. We do not find negative employment effects among women, Blacks, and/or Hispanics. In high‐impact counties, we find substantial declines in household and child poverty. These results inform policy debates about providing exemptions to a $15 federal minimum wage in low‐wage areas.     

Collective Bargaining and the Evolution of Wage Inequality in Italy

Italian male wage inequality has increased at a relatively fast pace from the mid‐1980s until the early 2000s, while it has been persistently flat since then. We analyse this trend, focusing on the period of most rapid growth in pay dispersion. By accounting for worker and firm fixed effects, it is shown that workers' heterogeneity has been a major determinant of increased wage inequalities, while variability in firm wage policies has declined over time. We also show that the growth in pay dispersion has entirely occurred between livelli di inquadramento, that is, job titles defined by national industry‐wide collective bargaining institutions, for which specific minimum wages apply. We conclude that the underlying market forces determining wage inequality have been largely channelled into the tight tracks set by the centralized system of industrial relations.     

‘Fair Work’ and the Modernization of Australian Labour Standards: A Case of Institutional Plasticity Entrenching Deepening Wage Inequality

Australia was long recognized for its relatively compressed wage structure. From the 1940s to the 1970s this was associated with a comprehensive regime of ‘award‐based’ minimum wages. Since the 1980s, this has been subjected to comprehensive ‘modernization’. After three decades of reform and in the most supportive economic environment in the OECD, Australian wage inequality has deepened. Although multiple political‐economic forces have been at play, the evolution of Australia's labour standards regime is an example of ‘institutional plasticity’ whereby the purpose and operations of wage‐setting institutions not only evolves but can actually be inverted over time.     

Who Is Affected by the Minimum Wage?

Prior surveys of empirical research on the minimum wage have been organized around the question “What does the minimum wage affect?” This survey is organized around the question “Who is affected by the minimum wage?” We review the consequences of the minimum wage for teens and young workers, men and women, African Americans and Hispanics, the less educated, workers in low‐wage industries, and low‐wage/low‐income populations. Although there is almost universal agreement that the minimum wage boosts earnings, evidence for a negative employment effect varies between mixed and nonexistent. An important gap in the literature is the paucity of research on low‐wage/low‐income groups.     

A Marriage Made in Heaven? Mismatches and Misunderstandings between Worker Centres and Unions

Worker centres, community‐based mediating institutions that provide support to low‐wage workers in the United States, have grown from five in 1992 to 160 in 2007. With unions increasingly targeting low‐wage immigrant workers employed in non‐footloose industries for organizing drives, it would seem that worker centres and unions are a match made in heaven. On the ground, however, it has been more of a mismatch. This article examines the underlying sources of the mismatch embodied in the structures, ideologies and cultures of worker centres and unions.     

Regulating Labour Standards via Supply Chains: Combining Public/Private Interventions to Improve Workplace Compliance

Concern over global labour standards has led to a profusion of non‐governmental forms of regulation. Systematic evaluation of these systems has been very limited to date. This article empirically explores an innovative system to regulate labour standards in the US garment industry combining public enforcement power and private monitoring, thereby drawing on different elements of global labour standards systems. We examine the impact of this system over time and in two distinct markets on employer compliance with minimum wage laws and find that these initiatives are associated with substantial reductions in minimum wage violations. The system therefore offers a useful model for international labour standards regulatory systems.     

Sharp Teeth or Empty Mouths? European Institutional Diversity and the Sector‐Level Minimum Wage Bite

The article explores the link between different institutional features of minimum wage systems and the minimum wage bite. We notably address the striking absence of studies on sectoral‐level minima and exploit unique data covering 17 European countries and information from more than 1,100 collective bargaining agreements. Results provide evidence for a neglected trade‐off: systems with bargained sectoral‐level minima are associated with higher Kaitz indices than systems with statutory floors, but also with more individuals actually paid below prevailing minima. Higher collective bargaining coverage can, to some extent, reduce this trade‐off between sharp teeth (high wage floors) and empty mouths (non‐compliance/non‐coverage).     

Do Minimum Wages Really Reduce Teen Employment? Accounting for Heterogeneity and Selectivity in State Panel Data

Traditional estimates that often find minimum wage disemployment effects include controls for state unemployment rates and state‐ and year‐fixed effects. Using CPS data on teens for the period 1990–2009, we show that such estimates fail to account for heterogeneous employment patterns that are correlated with selectivity among states with minimum wages. As a result, the estimates are often biased and not robust to the source of identifying variation. Including controls for long‐term growth differences among states and for heterogeneous economic shocks renders the employment and hours elasticities indistinguishable from zero and rules out any but very small disemployment effects. Dynamic evidence further shows the nature of bias in traditional estimates, and it also rules out all but very small negative long‐run effects. In addition, we do not find evidence that employment effects vary in different parts of the business cycle. We also consider predictable versus unpredictable changes in the minimum wage by looking at the effects of state indexation of the minimum wage.     

最低工资标准、劳动力素质与FDI

本文利用我国30个省区2000～2014年的面板数据,分投资地区和投资类型考察了最低工资标准、劳动力素质对FDI流入规模的影响。研究发现：最低工资上涨对FDI流入规模呈现正U型影响;最低工资上涨通过提高劳动力素质增大FDI的流入规模。在东部地区,最低工资上涨对FDI流入规模呈现倒U型影响;而在中西部地区,最低工资上涨对FDI流入规模呈现正U型影响。最低工资上涨通过提高劳动力素质,增大了劳动密集型和资本密集型FDI的流入规模;而对技术密集型FDI的流入没有影响。本文的研究成果可为中国当前的最低工资制度、人才发展战略以及“引进来”战略的调整提供参考依据。     

Explaining the Small Employment Effects of the Minimum Wage in the United States

This paper reviews the most recent wave of research—roughly since 2000—on the employment effects of the U.S. minimum wage and concludes that the weight of evidence points to little or no employment response to modest increases. The paper then examines eleven possible adjustments to minimum‐wage increases that may explain why the measured employment effects are consistently small. Given the relatively low cost to employers of modest increases in the minimum wage, these adjustment mechanisms appear to be sufficient to avoid employment losses, even for employers with a large share of low‐wage workers.     

我国最低工资标准的就业效应——基于全国和地区的实证研究

利用1996年～2007年全国27个省、直辖市、自治区的面板数据模型，考察了最低工资标准对就业的影响。实证结果表明，最低工资标准的提高对全国总体就业有负影响，但影响力度很小。进一步的地区分析表明，最低工资标准的提高对东、西部地区的就业有负影响，对中部地区的就业则无显著性影响。最后给出了相关的政策建议。     

Metropolitan Wage Levels of Less‐Educated Workers: 1986 to 1999

This work investigates determinants of metropolitan wage levels for workers with a high school education or less. It estimates their wage levels as a function of four factors: labor demand, industry mix, unionization, and the minimum wage. Labor demand and union strength influence wage levels most. The minimum wage and industry mix play smaller roles, although the minimum wage is the second most influential factor for men and women who did not complete high school. From 1990 to 1999, metropolitan wage levels exhibit considerable persistence, though persistence declines over this period.     

The Employment Effects of Minimum Wages: Evidence from a Prespecified Research Design The Employment Effects of MinimumWages

This article presentsevidence on the employment effects of recent minimum wage increases from a prespecified research design that entailed committing to a detailed set of statistical analyses prior to “going to” the data. The limited data to which the prespecified research design can be applied may preclude finding many significant effects. Nonetheless, the evidence is most consistent with disemployment effects of minimum wages for younger, less‐skilled workers.     

The Effect of Minimum Wages on Labour Market Outcomes: County‐Level Estimates from the Restaurant‐and‐Bar Sector

We use US county‐level data on employment and earnings in the restaurant‐and‐bar sector to evaluate the impact of minimum‐wage changes in low‐wage labour markets. Our estimated models are consistent with a simple competitive model in which supply‐and‐demand factors affect both the equilibrium outcome and the probability of the minimum wage being binding. Our evidence does not suggest that minimum wages reduce employment once controls for trends in county‐level sectoral employment are incorporated. Rather, employment appears to exhibit an independent downward trend in states that have increased their minimum wages relative to states that have not, thereby predisposing estimates towards reporting negative outcomes.     

The Effects of Minimum Wages on Food Stamp Enrollment and Expenditures

We provide the first causal analysis of how minimum wages affects enrollments and expenditures in the Supplemental Nutrition Assistance Program (SNAP). Exploiting state‐ and federal‐level variation in minimum‐wage policy between 1990 and 2012, and incorporating local controls in our specifications, we find that a 10 percent minimum wage increase reduces SNAP enrollment between 2.4 and 3.2 percent, and reduces program expenditures an estimated 1.9 percent. If the federal minimum wage were increased from $7.25 to $10.10, enrollment would fall between 7.5 and 8.7 percent (3.1 to 3.6 million persons) relative to 2012 levels, and annual expenditures would decrease 6 percent ($4.6 billion).