Falk, Armin; Fehr, Ernst; Zehnder, Christian - Institut für Volkswirtschaftslehre, …
The prevailing labor market models assume that minimum wages do not affect the labor supply schedule. We challenge this … view in this paper by showing experimentally that minimum wages have significant and lasting effects on subjects …’ reservation wages. The temporary introduction of a minimum wage leads to a rise in subjects’ reservation wages which persists even …