The impact of differential payroll tax subsidies on minimum wage employment

Kramarz, Françis; Philippon, Thomas

doi:10.1016/s0047-2727(00)00137-7

“…Similar to our findings Kramarz and Philippon [2001] report for the French labor market between 1990 and 1998 that the effects of labor cost increases and decreases caused by legal changes were not symmetric.…”

supporting

confidence: 91%

Fairness Perceptions and Reservation Wages?The Behavioral Effects of Minimum Wage Laws*

Falk¹,

Fehr²,

Zehnder³

2006

Quarterly Journal of Economics

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“…Moreover, in many sectors this national minimum is topped up, by 17% on average (Rycx and Kampelmann, 2013). Even if the minimum wage is found to have ambiguous effects on employment, at such high a level it is expected to reduce employment of low skilled youth, for whom it is most likely binding (Kramarz and Philippon, 2001;Neumark and Wascher, 2008;Cahuc and Carcillo, 2014).…”

Section: Literature Reviewmentioning

confidence: 99%

Scars of recessions in a rigid labor market

Cockx

¹

,

Ghirelli

²

2016

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may Scars of Recessions in a Rigid Labor Market AbstractWe study the impact of graduating in a recession in Flanders (Belgium), i.e. in a rigid labor market. In the presence of a high minimum wage, a typical recession hardly influences the hourly wage of low educated men, but reduces working time and earnings by about 4.5% up to twelve years after graduation. For the high educated, the working time is not persistently affected, but the penalty on the hourly wage (and earnings) increases with experience, and attains roughly -6% ten years after labor market entry. We also contribute to the literature on inference with few clusters.

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“…The instrument aims to capture average differences in graduation rates between the two groups, differences that are likely to reflect the policy change. 43 The short-run effect of the reform was large: in 1990, the relative skill supply of the treated group was 0.7 log points higher than that of 40 In one set of results, we also examined the effect of payroll tax subsidies in place since the early 1990s for minimum-wage workers receiving between 1 and 1.2 times the minimum wage Kramarz and Philippon (2001). Changes in the payroll tax for unskilled workers may have a confounding effect on our estimates because the LFS, FQP and DADS datasets do not include employer-paid contributions.…”

mentioning

confidence: 99%

The great compression of the French wage structure, 1969–2008

Verdugo

¹

2014

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SIZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. In contrast to the US and the UK, this period was also characterised by a substantial increase in the educational attainment of the labour force. This paper investigates whether differences in the timing of educational expansion over the last forty years can explain the divergent evolution of upper tail wage inequality in France relative to other countries. Using a model with imperfect substitution between experience groups, the estimates suggest that the rapid increase in the supply of educated workers during the 1970s and 1990s produced a substantial decline in the skill premium within cohorts. As a result, between a third and half of the decline in wage inequality at the top of the distribution in France during this period is explained by the increase in the educational attainment of the labour force.JEL Classification: J31

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The impact of differential payroll tax subsidies on minimum wage employment

Cited by 153 publications

References 18 publications

Fairness Perceptions and Reservation Wages?The Behavioral Effects of Minimum Wage Laws*

Fairness Perceptions and Reservation Wages?The Behavioral Effects of Minimum Wage Laws*

Scars of recessions in a rigid labor market

The great compression of the French wage structure, 1969–2008

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