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Efficiency vs. equity : does this trade-off hold for minimum wage policy? / Sergio Puente

IFO DICE Report . ISSN2511-7823 . Munich : IFO Institut, Vol. 16, no 4 (2018) , p. 27-30

Minimum wage policy is often seen as a tool to ensure lower income inequality. From a theoretical point of view, raising minimum wage has costs in the form of employment losses and unemployment, as labour supply for those jobs with equilibrium wages below the minimum cannot find enough labour demand. However, there is also a theory supporting minimum wages. Those workers losing their low-wage jobs could find it profitable to increase their human capital, in order to find a new, better job that complies with the new minimum level, and hence increases the productivity of the economy. If labour demand takes the form of very few agents with some monopsony power, then setting a higher minimum wage could also partially offset the market power of those few employers... [Da introd.]

política do emprego; mercado do trabalho; salário mínimo; Espanha; produtividade do trabalho; imposto sobre o rendimento das pessoas singulares

44 EMPREGO E TRABALHO

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