The Ambiguous Effect of Minimum Wages on Workers and Total Hours
AbstractWe model a standard competitive labour market where firms choose combinations of workers and hours per worker to produce output. If one assumes that the scale of production has no impact on hours per worker, then the change in the number of workers and hours per worker resulting from a minimum wage are inversely related. We also demonstrate that total hours worked at the firm may rise if there are small fixed costs to hiring workers.
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Bibliographic InfoPaper provided by School Of Economics, University College Dublin in its series Working Papers with number 200714.
Length: 10 pages
Date of creation: 27 Aug 2007
Date of revision:
Minimum wages; hours; employment;
Other versions of this item:
- Strobl, Eric & Walsh, Frank, 2008. "The Ambiguous Effect of Minimum Wages on Workers and Total Hours," IZA Discussion Papers 3643, Institute for the Study of Labor (IZA).
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
- J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-08-21 (All new papers)
- NEP-BEC-2008-08-21 (Business Economics)
- NEP-LAB-2008-08-21 (Labour Economics)
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