Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/173394
Authors: 
Caliendo, Marco
Fedorets, Alexandra
Preuss, Malte
Schröder, Carsten
Wittbrodt, Linda
Year of Publication: 
2017
Series/Report no.: 
SOEPpapers on Multidisciplinary Panel Data Research No. 948
Abstract: 
This study quantifies the short-term distributional effects of the new statutory minimum wage in Germany. Using detailed survey data (German Socio-Economic Panel), we assess changes in the distributions of hourly wages, contractual and actual working hours, and monthly earnings. Our descriptive results indicate growth at the bottom of the hourly wage distribution in the post-reform year, but also considerable noncompliance among eligible employees. In a second step, we employ a difference-in-differences analysis and exploit regional variation in the "bite" of the intervention, measured by the share of employees in a geographical region with wages below the minimum wage prior to the reform. We document the reform's positive effect at the bottom of the wage distribution. However, we find a negative effect of the reform on contractual hours worked, which explains why there is no effect on monthly earnings. Given that actual hours worked decrease less than contractual hours, our evidence suggests an increase in unpaid overtime.
Subjects: 
minimum wage
wage distribution
hourly wages
inequality
JEL: 
J31
J38
J22
Document Type: 
Working Paper

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