Living wages: Protection for or protection from low-wage workers?
AbstractLiving wage laws are touted as anti-poverty measures. Yet they apply to only a small fraction of workers, most commonly covering only employers with city contracts. The apparent contradiction between broad anti-poverty goals and narrow coverage suggests that goals other than poverty reduction may partly underlie living wage campaigns. This paper considers the hypothesis that living wage laws act to maintain or increase rents among unionized municipal workers. By raising the wages that city contractors would have to pay, living wage laws may reduce the incentives for cities to contract out work that would otherwise be done by unionized municipal employees, hence increasing the bargaining power of municipal unions and leading to higher wages for their members. The evidence presented here, from an analysis of CPS data for 1996-2000, indicates that the wages of unionized municipal workers are indeed increased as a result of living wages covering contractors. (Free full-text download available at http://digitalcommons.ilr.cornell.edu/ilrreview/.)
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Bibliographic InfoArticle provided by ILR Review, Cornell University, ILR School in its journal ILR Review.
Volume (Year): 58 (2004)
Issue (Month): 1 (October)
Postal: 381 Ives East, Cornell University, Ithaca, NY 14853-3901
Other versions of this item:
- David Neumark, 2001. "Living Wages: Protection For or Protection From Low-Wage Workers?," NBER Working Papers 8393, National Bureau of Economic Research, Inc.
- J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
- J58 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Public Policy
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