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The Role of the Minimum Wage in the Welfare State: An Appraisal

Author

Listed:
  • Dolado, Juan J.

    (Universidad Carlos III de Madrid)

  • Felgueroso, Florentino

    (FEDEA, Madrid)

  • Jimeno, Juan F.

    (Bank of Spain)

Abstract

In order to offer a balanced assessment of the role of minimum wages in the Welfare State, seven basic questions need to be answered: (i) Why is the minimum wage a useful redistributive tool?; (ii) How binding are minimum wage floors in different countries?; (iii) To what extent do minimum wages have the adverse consequences that standard analysis predict?; (iv) Are there strong theoretical grounds underlying the revisionist results?; (v) Who supports minimum wages?; (vi) Under which conditions is the minimum wage a better tool than other policy instruments to achieve income redistribution?; and, finally, (vii) What is the overall cross-country time-series evidence regarding the employment effect of the minima? The aim of this paper is to provide an appraisal on the available evidence for each of the above-mentioned issues.

Suggested Citation

  • Dolado, Juan J. & Felgueroso, Florentino & Jimeno, Juan F., 2000. "The Role of the Minimum Wage in the Welfare State: An Appraisal," IZA Discussion Papers 152, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp152
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    More about this item

    Keywords

    inequality; minimum wages; employment;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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