The German Minimum Wage: Effects on Productivity, Profitability, and Investments

2020 ◽  
Vol 240 (2-3) ◽  
pp. 321-350 ◽  
Author(s):  
Mario Bossler ◽  
Nicole Gürtzgen ◽  
Benjamin Lochner ◽  
Ute Betzl ◽  
Lisa Feist
Keyword(s):  
Human Capital ◽  
Minimum Wage ◽  
Treatment Effects ◽  
Slight Reduction ◽  
Capital Investments ◽  
Further Training ◽  
Difference In Differences ◽  
Personnel Costs ◽  
Wage Effects ◽  
Iab Establishment Panel

AbstractIn this article, we analyze the effects of the introduction of the German minimum wage using difference-in-differences estimations applied to the IAB Establishment Panel. The treatment effects on the treated establishments show a significant increase in personnel costs. When we analyze the effects of the minimum wage on the net sales of intermediates, we observe a reduction, which is fully explained by the increase in wage costs induced by the minimum wage. The results do not point to effects on establishment-level productivity or capital investments. Looking at investments in human capital, we do not observe any effects on apprenticeship offers or the placement of apprentices. If anything, the results point at a slight reduction in the provision of further training.

Further Training and Company-Level Pacts for Employment in Germany

2012 ◽  
Vol 232 (2) ◽  
Author(s):  
Lutz Bellmann ◽  
Hans-Dieter Gerner
Keyword(s):  
Human Capital ◽  
Regression Models ◽  
Working Hours ◽  
Causal Effects ◽  
Capital Investments ◽  
Human Capital Formation ◽  
Further Training ◽  
Time Series Regression ◽  
Human Capital Investments ◽  
Iab Establishment Panel

SummaryThis paper aims at investigating whether or not and to what extent company-level pacts for employment and competitiveness (CLPs) have an impact on the accumulation of human capital. The effect of CLPs on further training is analyzed utilizing the IAB Establishment Panel data of the years 2003 to 2007. CLPs are agreements between firms’ management and their respective workforce that are characterized by reduced wages or prolonged working hours in exchange for employment guarantees or investment programs, such as further training. CLPs not only explicitly contain clauses concerning further training, but also increase employment stability and may increase the firms’ incentives for human capital investments, due to the employees’ wage concessions. In order to test this hypothesis we apply parametric as well as semiparametric cross-section time-series regression models. However, our findings suggest that CLPs do not exert positive causal effects on human capital formation as measured by further training incidence and intensity variables.

scholarly journals Employment Effects of the New German Minimum Wage: Evidence from Establishment-Level Microdata

ILR Review ◽  
2019 ◽  
Vol 73 (5) ◽  
pp. 1070-1094 ◽  
Author(s):  
Mario Bossler ◽  
Hans-Dieter Gerner
Keyword(s):  
Minimum Wage ◽  
Labor Demand ◽  
Working Hours ◽  
Employment Effect ◽  
Demand Elasticity ◽  
First Year ◽  
Difference In Differences ◽  
Employment Effects ◽  
Iab Establishment Panel

The authors present the first evidence on the consequences of the new statutory minimum wage in Germany, which was implemented on January 1, 2015. Using the IAB Establishment Panel, they identify employment effects from variation in the extent that establishments are affected by the minimum wage. A difference-in-differences estimation reveals an increase in average wages between 3.8% and 6.3% and an employment loss by approximately 1.7% in establishments affected by the minimum wage. These estimates imply a labor demand elasticity with respect to wages ranging between −0.2 and −0.4. The authors also observe a transitory reduction of the working hours in the first year after the introduction and that the employment effect seems mostly driven by a reduction in hires rather than by an increase in layoffs.

The effects of youth labour market reforms: evidence from Italian apprenticeships

2019 ◽  
Author(s):  
Andrea Albanese ◽  
Lorenzo Cappellari ◽  
Marco Leonardi
Keyword(s):  
Human Capital ◽  
Propensity Score ◽  
Capital Accumulation ◽  
Causal Effects ◽  
Human Capital Accumulation ◽  
Difference In Differences ◽  
Labour Market Reforms ◽  
Youth Labour Market ◽  
Long Run ◽  
Wage Effects

Abstract In this paper, we estimate the causal effects of the 2003 reforms to the Italian apprenticeship contract that increased its legal length, allowed on-the-job training and introduced a minimum floor to apprentices’ wages. Using administrative data, we implement a covariate balancing propensity score and a difference-in-differences estimator. We find that the new contract improves the chances of an apprentice obtaining a permanent job in the same firm five years after hiring; however, this occurs more frequently in large firms. We also find sizeable, long-run wage effects that extend well beyond the legal duration of the apprenticeship contract. These effects are compatible with increased human capital accumulation, possibly due to the reformed training provisions.

Human Capital in the Economic System of Modern Society: the Mechanism of Formation, Investment and Development Prospects in Ukraine

2019 ◽  
pp. 105-109
Author(s):  
S. Zhukov ◽  
V. Zelic ◽  
S. Soima
Keyword(s):  
Human Capital ◽  
Modern Society ◽  
Capital Investments ◽  
Mechanism Of Formation ◽  
Strategic Development ◽  
Education And Health ◽  
Economic State ◽  
Human Capital Investments ◽  
State Of Affairs ◽  
Development Prospects

As a result of the conducted research the problems of development of human capital and basic pre-conditions of providing of his competitiveness are certain. Analyzed the loud speaker of charges on development of education and health protection of summary budget of Ukraine and measures on the improvement of economic situation in Ukraine and providing of development of human capital are offered. The basic types of investments are certain in a human capital on levels and subjects of investing. The mechanism of forming of human capital is presented. The mechanism of forming of human capital is presented. It is grounded, that for strategic development of human capital of Ukraine and achievement of equilibrium and balanced of economy in the conditions of globalization modernization of public policy is needed in area of education, namely, creation of the system of education, oriented to forming and development of skills and jurisdictions of man, necessary for innovative activity. Keywords human capital, investments in a human capital, competitiveness, economic state of affairs, payment for work.

Minimum Wage Effects Under Weak Compliance with Labor Regulations: The Case of Bolivia

2017 ◽  
Author(s):  
Marcelo Claure ◽  
Jorge DDvalos ◽  
Alejandra Leyton ◽  
Vanessa SSnchez ◽  
Christian Valencia
Keyword(s):  
Minimum Wage ◽  
Labor Regulations ◽  
Wage Effects

scholarly journals Occupational Choice and Investments in Human Capital in Informal Economies

2020 ◽  
Vol 0 (0) ◽  
Author(s):  
Lucila Berniell
Keyword(s):  
Human Capital ◽  
Informal Economy ◽  
Occupational Choice ◽  
Capital Investments ◽  
Educational Decisions ◽  
Managerial Skills ◽  
Model Predictions ◽  
Informal Economies ◽  
Human Capital Investments ◽  
Cross Country

AbstractInformality is pervasive in many developing countries and it can affect occupational and educational decisions. Cross-country data shows that the rate of entrepreneurship as well as the gap between the skill premium for entrepreneurs and for workers increase with the size of the informal economy. Also, in countries with larger informal sectors the fraction of high-skilled individuals that choose to be entrepreneurs is larger. To explain these facts, I develop a model economy with human capital investments, occupational choice and an informal sector, in which the investment in human capital improves the efficiency of labor as well as managerial skills, and the technology to produce goods exhibits capital-skill complementarity. Model predictions can account for cross-country evidence and also shed light on the mechanisms at work when the level of informality in the economy increases. In particular, a higher level of informality discourages human capital investments for workers while it incentivizes these investments for the case of some managers, mostly informal but talented.

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