Lost in Transition? – Minimum Wage Effects on German Construction Workers
Using a linked employer-employee data set on the German construction industry, we analyse the effects of the introduction of minimum wages in this sector on labour market dynamics. In doing so, we focus on accessions and separations, as well as the underlying labour market flows, at the establishment level. The fact that minimum wages in Germany are sector-specific enables us to use other industries as control groups within a difference-in-differences framework. We find that both accessions and separations rise in East Germany as a result of the minimum wage introduction. The evidence on detailed worker flows suggests that this is mainly due to increased recalls. Furthermore, the minimum wage introduction lowered job-to-job transitions in East Germany, which can be explained by a more compressed wage distribution making on-the-job search less worthwhile. No clear effects on labour market dynamics in West Germany arise.
|Date of creation:||Jul 2012|
|Date of revision:|
|Contact details of provider:|| Postal: Hohenzollernstraße 1-3, 45128 Essen|
Web page: http://www.rwi-essen.de/
More information through EDIRC
|Order Information:||Web: http://www.rwi-essen.de/publikationen/|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Pierre Brochu & David A. Green, 2013.
"The Impact of Minimum Wages on Labour Market Transitions,"
Royal Economic Society, vol. 123(12), pages 1203-1235, December.
- Pierre Brochu & David A. Green, 2011. "The impact of minimum wages on quit, layoff and hiring rates," IFS Working Papers W11/06, Institute for Fiscal Studies.
- Dube, Arindrajit & Lester, T. William & Reich, Michael, 2011.
"Do Frictions Matter in the Labor Market? Accessions, Separations, and Minimum Wage Effects,"
Institute for Research on Labor and Employment, Working Paper Series
qt4t3342nd, Institute of Industrial Relations, UC Berkeley.
- Dube, Arindrajit & Lester, T. William & Reich, Michael, 2011. "Do Frictions Matter in the Labor Market? Accessions, Separations and Minimum Wage Effects," IZA Discussion Papers 5811, Institute for the Study of Labor (IZA).
- Dale T. Mortensen & Christopher A. Pissarides, 1994. "Job Creation and Job Destruction in the Theory of Unemployment," Review of Economic Studies, Oxford University Press, vol. 61(3), pages 397-415.
- Frings, Hanna, 2012. "The Employment Effect of Industry-Specific, Collectively-Bargained Minimum Wages," Ruhr Economic Papers 348, Rheinisch-Westfälisches Institut für Wirtschaftsforschung (RWI), Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
- Pedro Portugal & Ana Rute Cardoso, 2006.
"Disentangling the Minimum Wage Puzzle: An Analysis of Worker Accessions and Separations,"
Journal of the European Economic Association,
MIT Press, vol. 4(5), pages 988-1013, 09.
- Portugal, Pedro & Cardoso, Ana Rute, 2002. "Disentangling the Minimum Wage Puzzle: An Analysis of Worker Accessions and Separations," IZA Discussion Papers 544, Institute for the Study of Labor (IZA).
- Marion König & Joachim Möller, 2009. "Impacts of minimum wages: a microdata analysis for the German construction sector," International Journal of Manpower, Emerald Group Publishing, vol. 30(7), pages 716-741, November.
- Bachmann, Ronald & Bauer, Thomas K. & Kröger, Hanna, 2012.
"Minimum Wages as a Barrier to Entry – Evidence from Germany,"
Ruhr Economic Papers
329, Rheinisch-Westfälisches Institut für Wirtschaftsforschung (RWI), Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
- Ronald Bachmann & Thomas K. Bauer & Hanna Frings, 2014. "Minimum Wages as a Barrier to Entry: Evidence from Germany," LABOUR, CEIS, vol. 28(3), pages 338-357, 09.
- Bachmann, Ronald & Bauer, Thomas K. & Kroeger, Hanna, 2012. "Minimum Wages as a Barrier to Entry: Evidence from Germany," IZA Discussion Papers 6484, Institute for the Study of Labor (IZA).
- David Neumark & William L. Wascher, 2008. "Minimum Wages," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262141027, June.
When requesting a correction, please mention this item's handle: RePEc:rwi:repape:0358. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sabine Weiler)
If references are entirely missing, you can add them using this form.