wage floor
Recently Published Documents


TOTAL DOCUMENTS

26
(FIVE YEARS 12)

H-INDEX

4
(FIVE YEARS 2)

2021 ◽  
Author(s):  
Robert Dur ◽  
Ola Kvaløy ◽  
Anja Schöttner

Why do some leaders use praise as a means to motivate workers, whereas other leaders use social punishment? This paper develops a simple economic model to examine how leadership styles depend on the prevailing labor market conditions for workers. We show that the existence of a binding wage floor for workers (e.g., due to trade union wage bargaining, minimum wage legislation, or limited-liability protection) can make it attractive for firms to hire a leader who makes use of social punishment. Although the use of social punishments generally is socially inefficient, it lessens the need for high bonus pay, which allows the firm to extract rents from the worker. In contrast, firms hire leaders who provide praise to workers only if it is socially efficient to do so. Credible use of leadership styles requires either repeated interaction or a leader with the right social preferences. In a single-period setting, only moderately altruistic leaders use praise as a motivation tool, whereas only moderately spiteful leaders use social punishment. Lastly, we show that when the leaders’ and workers’ reservation utilities give rise to a bigger income gap between leaders and workers, attracting spiteful leaders becomes relatively less costly and unfriendly leadership becomes more prevalent. This paper was accepted by Axel Ockenfels, behavioral economics and decision analysis.


2021 ◽  
pp. 41-43
Author(s):  
Kshama Mumbai

“The Lawrence Textile Strike, also known as the Bread and Roses Strike”, prompted the first minimum wage law in the United States in 1912. Various states followed suit over the next two decades, and in 1938, at the height of the Great Depression, Congress passed the Fair Labor Standards Act, which created a federal minimum wage (FLSA).The basic incentive behind the introduction of the Act was to reduce income inequality.A rise in minimum wage acts as a form of relocation of wealth from higher-income people to lower-income people. In principle, Congress amends the FLSA on a regular basis to raise the federal minimum wage to levels necessary for even the lowest-paying workforces in the economy.It also aims to help low-wage workers benefit from overall economywide advances in living standards. However, this has historically not always been the case. In 1968, The Poor People’s 1 Campaign started because of not raising the minimum wage to sufficient levels . The explicit purpose of the federal minimum wage is to help increase consumer purchasing power which stimulates the economy and to keep America's workforces out of poverty.However,the law failed to include the automatic cost of living adjustments and led to inflation eroding the real value of the minimum wage over time. There is a dire need for legislative action to raise the nation’s wage floor, more so than ever during the COVID-19 pandemic.Unless consumer's purchasing power is increased,it will be difficult to come out of this recession.Further,the minimum wage is a direct concern for poverty levels and gender / racial inequality.This paper aims to analyze previous work on the issue and provide further recommendations for the same.


Author(s):  
Saif Benjaafar ◽  
Jian-Ya Ding ◽  
Guangwen Kong ◽  
Terry Taylor

Problem definition: An on-demand service platform relies on independent workers (agents) who decide how much time, if any, to devote to the platform. Some labor advocates have argued that an expansion of the labor pool hurts agents—by reducing the wage and agent utilization (i.e., the fraction of time an agent is busy serving customers). Motivated by concern for agent welfare, regulators are considering measures that reduce the labor pool size or that impose a floor on the nominal wage or effective wage (i.e., the product of the nominal wage and agent utilization). Are agents indeed hurt by an expansion in the labor pool size? Which type of wage-floor regulation is preferable? Are consumers hurt by the imposition of a wage floor? Academic/practical relevance: Because independent agents work without the traditional protections intended to ensure the welfare of employees, the welfare of those agents is an important concern. Methodology: We employ an equilibrium model that accounts for the interaction among price, wage, labor supply, customer delay, and demand. Results: Average labor welfare increases and then decreases in the labor pool size; that is, agents are harmed by an expansion in the labor pool size if and only if the labor pool size is sufficiently large. The effective wage floor is superior to the nominal wage floor in terms of labor welfare maximization. More generally, the two types of wage floors have structurally different effects on labor welfare, with a floor on the nominal wage only beneficial to agents if it is sufficiently small. Contrary to the conventional view that consumers are hurt by an effective wage floor (because they face a higher price, due to upward pressure on the wage, and longer delay, due to upward pressure on agent utilization), consumers actually benefit. Managerial implications: Regulators, labor advocates, platform managers, and agents benefit from understanding the forces that create and destroy labor welfare.


2020 ◽  
Vol 11 (3) ◽  
Author(s):  
Christoph Scherrer

The renegotiated North American Free Trade Agreement (NAFTA), now called the United States–Mexico–Canada Agreement (USMCA), contains two interesting innovations: the requirement of aminimum average wage in the manufacturing of motor vehicles (the Labour Value Content clause)and a detailed prescription for the reform of Mexican labour law. Both could serve as models forfuture labour chapters in trade agreements. The assessment contained in this article is based on theviews of those who demanded renegotiation of the labour-related provisions of NAFTA, expertson labour rights in free trade agreements (FTAs) and ethics criteria. The assessment results in asplit picture. The labour-related provisions came about under ethically problematic circumstancesand their complexity leaves much room for criticism. Yet, the idea of inserting a wage floor in anFTA, as well as monitoring and sanctioning mechanisms for ensuring internationally recognisedlabour rights, merits further consideration for future trade agreements.KEYWORDS: globalisation; industrial relations; competitiveness; trade agreements; outsourcing


2020 ◽  
Vol 28 ◽  
pp. 32
Author(s):  
Márcia Aparecida Jacomini ◽  
Rosana Evangelista da Cruz ◽  
Edimária Carvalho de Castro

This article aims to analyze the legal, academic and union apparatuses that guide the definition of the teaching working day, verifying how the career plans of the states and capitals incorporated this question. The research is based on documental and bibliographic research. The results indicate diverse teaching working days, although those of 20 and 40 hours per week are predominant. The Wage Floor Law regarding the distribution of the teaching working day is not met by most states and capitals; only 11 states and seven capitals fully comply with the Law. Aspects such as duration and composition of the teaching working day, accumulation of positions, exclusive dedication and working in a single school are still incipiently faced by educational networks. It is considered necessary to move forward with a view to overcoming the fragmentation of the teaching working day with a view to the appreciation for teaching and improving teaching conditions in public basic schools.


2020 ◽  
Vol 240 (2-3) ◽  
pp. 295-319 ◽  
Author(s):  
Holger Bonin ◽  
Ingo E. Isphording ◽  
Annabelle Krause-Pilatus ◽  
Andreas Lichter ◽  
Nico Pestel ◽  
...  

AbstractThis paper studies the effects of the introduction of Germany’s statutory minimum wage in 2015 on employment and unemployment on the level of regional labor markets. Using variation in the regional exposure to the new wage floor, we employ a difference-in-differences approach that compares the evolution of employment and unemployment between regions with varying minimum wage bites. Overall, we find no statistically significant effect of the introduction of the German minimum wage on regular employment subject to social insurance, but a statistically significant negative effect on marginal employment. The reduction is not accompanied by a proportional increase in unemployment.


2020 ◽  
Vol 240 (2-3) ◽  
pp. 269-294 ◽  
Author(s):  
Martin Friedrich

AbstractThis paper evaluates the short to medium run employment effects of the 2015 introduction of a statutory minimum wage in Germany. The effect of the policy is recovered from variation in the bite of the minimum wage across occupations using a difference-in-differences estimator. The analysis reveals that the reform only had a small impact on employment and highlights the importance of regional effect heterogeneity. In East Germany, marginal employment decreased by about 18,000 jobs in the short run and 52,000 jobs in the medium run, respectively, due to the minimum wage. In West Germany, no negative employment effects are detectable, but regular employment increased temporarily because of the reform. The medium run estimates include the impact of the first marginal increase of the wage floor from €8.50 to €8.84 in 2017.


2020 ◽  
Vol 240 (2-3) ◽  
pp. 201-231 ◽  
Author(s):  
Patrick Burauel ◽  
Marco Caliendo ◽  
Markus M. Grabka ◽  
Cosima Obst ◽  
Malte Preuss ◽  
...  

AbstractThis paper evaluates the short-run impact of the introduction of a statutory minimum wage in Germany on the hourly wages and monthly earnings of workers targeted by the reform. We first provide detailed descriptive evidence of changes to the wage structure in particular at the bottom of the distribution and distinguish between trends for regularly employed and marginally employed workers. In the causal analysis, we then employ a differential trend adjusted difference-in-differences (DTADD) strategy to identify the extent to which these changes in wages and earnings can be attributed to the minimum wage introduction. We find that the minimum wage introduction can account for hourly wage growth in the order of roughly 6.5 % or \euro0.45/hour and an increase in monthly earnings of 6.6 % or \euro53/month. Despite finding wage growth at the bottom of the distribution, the paper documents widespread non-compliance with the mandated wage floor of \euro8.50/hour.


Author(s):  
Gürdal Aslan

This study provides information on wage floor determining institutions, the statutory minimum wages, and collective bargaining agreements, in the EU countries to examine differences and commonalities of these institutions between the EU countries and Turkey. The interaction between these institutions and the labor market performance of the EU Member States and Turkey is also investigated. Therefore, the minimum wage levels and the collective bargaining coverage with the labor market indicators, namely the wage inequality measured with D1/D9 ratio and the incidence of low-wage workers, are compared. Findings indicate that the wage inequality and the incidence of low-wage workers are relatively lower in the countries with comprehensive collective bargaining systems characterized by high rates of collective bargaining coverage and union density. Turkey is one of the countries with the highest wage inequality compared to the EU countries. Improving the coverage rate of collective bargaining might help to reduce wage inequality.


2019 ◽  
Vol 685 (1) ◽  
pp. 172-188
Author(s):  
Andrew Schrank

Workers in the United States have lost their voice (or influence) in Washington and the workplace. Industrial unions are ill-suited to the postindustrial economy, and alternative organs of representation and influence (i.e., “alt-labor”) are trapped in a vicious circle of vulnerability and volatility that limits their likely growth. As a result of this, power is increasingly skewed toward employers and their political allies, who add to labor’s difficulties by eliminating and evading remaining labor protections. The federal government could help to restore a balance of power between workers and employers by establishing and enforcing a robust wage floor: (1) a $15 an hour minimum wage, (2) a nationwide hotline for workers who believe that their rights had been violated (“911 for workers”), and (3) a database that would allow regulatory agencies and worker organizations to rationalize and coordinate labor and employment law efforts. Doing so would produce a positive feedback loop so workers regain their voice on the job and in politics.


Sign in / Sign up

Export Citation Format

Share Document