Minimum Wages, Labor Market Institutions, and Female Employment and Unemployment: A Cross-Country Analysis
The authors investigate the employment consequences of minimum wage regulation in 16 OECD countries, 1970-2008. Their treatment is motivated by Neumark and Wascher's (2004) seminal cross-country study using panel methods to estimate minimum wage effects among teenagers and young adults. Apart from the longer time interval examined, a major departure is the authors' focus on prime-age females, a group often neglected in the minimum wage literature. Another is their deployment of time-varying policy and institutional regressors. The average effects they report are consistent with minimum wages causing material employment losses among the target group. Indeed, higher minimum wages are also associated with elevated joblessness, although these unemployment effects are less precisely estimated. Further, although the authors find common ground with Neumark and Wascher as regards the role of some individual labor market institutions and policies, they do not observe the same patterns in the institutional data. Specifically, prime-age females do not exhibit stronger employment losses in countries with the least regulated markets.
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Volume (Year): 65 (2012)
Issue (Month): 4 (October)
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