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Do minimum wages affect non-wage job attributes? Evidence on fringe benefits

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Author Info
Kosali Ilayperuma Simon
Robert Kaestner

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Abstract

Although many studies have tested neoclassical labor market theory's prediction that employers will react to binding minimum wages by changing employment levels, much less empirical research has explored the possibility that employers also respond to minimum wages by adjusting non-wage components of the job, such as fringe benefits, job safety, and access to training. Using Current Population Survey data for 1979-2000, this study investigates the effect of minimum wage legislation on the provision of employer health insurance and employer pension coverage. The authors examine effects of state and federal variation in minimum wages on groups likely to be affected by the minimum wage, and compare these effects to estimates found for groups unlikely to be affected. Whether the analysis uses only state-level variation or federal and state variation in minimum wages, the results indicate no discernible effect of the minimum wage on fringe benefit generosity for low-skill workers. (Free full-text download available at http://digitalcommons.ilr.cornell.edu/ilrreview/.)

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Publisher Info
Article provided by ILR Review, ILR School, Cornell University in its journal ILR Review.

Volume (Year): 58 (2004)
Issue (Month): 1 (October)
Pages: 52-70
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Handle: RePEc:ilr:articl:v:58:y:2004:i:1:p:52-70

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  1. Mirco Tonin, 2007. "Minimum Wage and Tax Evasion: Theory and Evidence," William Davidson Institute Working Papers Series wp865, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
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  2. T.D. Stanley & Chris Doucouliagous, 2006. "Publication Bias in Minimum-Wage Research? Card and Krueger Redux," Economics Series 2006_16, Deakin University, Faculty of Business and Law, School of Accounting, Economics and Finance. [Downloadable!]
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This page was last updated on 2009-12-14.

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