Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/36854
Authors: 
Pinoli, Sara
Year of Publication: 
2010
Series/Report no.: 
Discussion paper series // Forschungsinstitut zur Zukunft der Arbeit 4933
Abstract: 
This paper argues that expectations are an important element that needs to be included into the analysis of the effects of the minimum wage on employment. We show in a standard matching model that the observed employment effect is higher the lower is the likelihood associated with the minimum wage variation. On the other side, there is a significant anticipation effect, ignored in the literature. This property is able to explain the controversial results found in the empirical studies. When the policy is anticipated, the effect at the time of the actual variation is small and potentially hard to identify. The model is tested on Spanish data, taking advantage of the unexpected change in the minimum wage following the election of Zapatero in 2004.
Subjects: 
Minimum wage
expectations
heterogeneous matches
JEL: 
D21
J23
J38
Document Type: 
Working Paper

Files in This Item:
File
Size
501.99 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.