The ambiguous effect of minimum wages on hours

In a competitive model we ease the assumption that efficiency units of labour are the product of hours and workers. We show that a minimum wage may either increase or decrease hours per worker and the change will have the opposite sign to the slope of the equilibrium hours hourly wage locus. Similarly, total hours worked may rise or fall. We illustrate the results throughout with a Cobb-Douglas example.

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Year of publication:	2011
Authors:	Strobl, Eric ; Walsh, Frank
Published in:	Labour Economics. - Elsevier, ISSN 0927-5371. - Vol. 18.2011, 2, p. 218-228
Publisher:	Elsevier
Subject:	Minimum wages Hours Employment

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Type of publication:	Article
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10008861039