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The Productivity-Enhancing Impacts of the Minimum Wage: Lessons from Denmark and New Zealand

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  • Colm McLaughlin

Abstract

This article adds an international comparative perspective to the reflection on 100 years of minimum wage legislation in Britain by exploring the impact of minimum wage regulations and institutions in Denmark and New Zealand. In particular, it looks at the question of whether minimum wages can raise productivity through the 'shock effect'. It argues that while they will play a role, a supportive institutional framework is more important in providing coordinated solutions to issues of market failure, such as inadequate levels of training. The article suggests that sectoral bargaining institutions in low-paid sectors may have the potential to facilitate such coordination and enable the high-productivity model to emerge. Copyright (c) Blackwell Publishing Ltd/London School of Economics 2009.

Suggested Citation

  • Colm McLaughlin, 2009. "The Productivity-Enhancing Impacts of the Minimum Wage: Lessons from Denmark and New Zealand," British Journal of Industrial Relations, London School of Economics, vol. 47(2), pages 327-348, June.
  • Handle: RePEc:bla:brjirl:v:47:y:2009:i:2:p:327-348
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    References listed on IDEAS

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    1. Metcalf, David, 1999. "The Low Pay Commission and the National Minimum Wage," Economic Journal, Royal Economic Society, vol. 109(453), pages 46-66, February.
    2. William Brown, 2000. "Putting Partnership into Practice in Britain," British Journal of Industrial Relations, London School of Economics, pages 299-316.
    3. Brown, W., 2002. "The Operation of the Low Pay Commission," Cambridge Working Papers in Economics 0223, Faculty of Economics, University of Cambridge.
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    Cited by:

    1. Michael Weber, 2016. "Wage Determination and Employment Adjustment in Croatia," CESifo Forum, Ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 17(1), pages 22-26, April.
    2. Deakin, Simon., 2013. "Addressing labour market segmentation : the role of labour law," ILO Working Papers 994834483402676, International Labour Organization.
    3. Thomas Turner & Michelle O’Sullivan, 2013. "Economic Crisis and the Restructuring of Wage Setting Mechanisms for Vulnerable Workers in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 44(2), pages 197-219.
    4. Simon Deakin, 2013. "Addressing Labour Market Segmentation: The Role of Labour Law," Working Papers wp446, Centre for Business Research, University of Cambridge.
    5. Zoe Adams & Simon Deakin, 2014. "Institutional Solutions to Precariousness & Inequality in Labour Markets," Working Papers wp463, Centre for Business Research, University of Cambridge.
    6. repec:ilo:ilowps:483448 is not listed on IDEAS

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