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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

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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Bibliographic Info

Article provided by ILR Review, Cornell University, ILR School 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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Cited by:
  1. Tim Butcher & Richard Dickens & Alan Manning, 2012. "Minimum Wages and Wage Inequality: Some Theory and an Application to the UK," CEP Discussion Papers, Centre for Economic Performance, LSE dp1177, Centre for Economic Performance, LSE.
  2. Margherita Comola & Luiz de Mello, 2009. "How Does Decentralised Minimum-Wage Setting Affect Unemployment and Informality?: The Case of Indonesia," OECD Economics Department Working Papers, OECD Publishing 710, OECD Publishing.
  3. Kemal Kizilca & João Cerejeira & Miguel Portela & Carla Sá, 2010. "Minimum wage, fringe benefits, overtime payments and the gender wage gap," NIPE Working Papers, NIPE - Universidade do Minho 34/2010, NIPE - Universidade do Minho.
  4. John Schmitt, 2013. "Why Does the Minimum Wage Have No Discernible Effect on Employment?," CEPR Reports and Issue Briefs, Center for Economic and Policy Research (CEPR) 2013-04, Center for Economic and Policy Research (CEPR).
  5. Tonin, Mirco, 2007. "Minimum wage and tax evasion: theory," Discussion Paper Series In Economics And Econometrics, Economics Division, School of Social Sciences, University of Southampton 0711, Economics Division, School of Social Sciences, University of Southampton.
  6. Eva Lajtkepová, 2010. "Minimum Wage and Labour Market," Acta Oeconomica Pragensia, University of Economics, Prague, vol. 2010(1), pages 3-20.
  7. Aaron Lowen & Paul Sicilian, 2009. "“Family-Friendly” Fringe Benefits and the Gender Wage Gap," Journal of Economic Interaction and Coordination, Springer, Springer, vol. 30(2), pages 101-119, June.
  8. Tonin, Mirco, 2011. "Minimum wage and tax evasion: Theory and evidence," Journal of Public Economics, Elsevier, Elsevier, vol. 95(11), pages 1635-1651.
  9. 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.
  10. Elizabeth Powers, 2009. "The Impact of Minimum-Wage Increases: Evidence from Fast-food Establishments in Illinois and Indiana," Journal of Labor Research, Springer, Springer, vol. 30(4), pages 365-394, December.
  11. Rafael Lopes de Melo, 2012. "Firm Heterogeneity, Sorting and the Minimum Wage," 2012 Meeting Papers, Society for Economic Dynamics 611, Society for Economic Dynamics.
  12. World Bank, 2013. "Minimum Wage Policy : Lessons with a Focus on the ASEAN Region," World Bank Other Operational Studies 16687, The World Bank.

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