Minimum Wage Employment Effects and Labour Market Concentration

• 成果类型: Article
• 署名作者: Azar, Jose; Huet-Vaughn, Emiliano; Marinescu, Ioana; Taska, Bledi; von Wachter, Till
• 署名单位: University of Navarra; IESE Business School; Claremont Colleges; Pomona College; University of Pennsylvania; National Bureau of Economic Research; University of California System; University of California Los Angeles
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdad091
• 发表日期: 2023
• 页码: 1843-1883
• 关键词: skill requirements; subminimum wages; panel-data; increases; COMPETITION; california; monopsony; ECONOMICS; prices; IMPACT

摘要

This paper shows that more highly concentrated labour markets experience more positive employment effects of the minimum wage. In the most concentrated labour markets, employment rises following a minimum wage increase. The paper establishes its main findings by studying the effects of local minimum wage increases on a key low-wage retail sector, and using data on labour market concentration that covers the entirety of the U.S. with fine spatial variation at the occupation level. The results carry over to the fast-food sector and the entire low-wage labour market and are robust to using proxies of labour market concentration available for a broader range of industries, such as the number of establishments and population density. A model of oligopsonistic competition can explain these effects: there is more room to increase wages in high-concentration areas where wages tend to be further below marginal productivity. These findings provide evidence supporting monopsonistic wage setting as an explanation for the near-zero minimum wage employment effect documented in prior work.