The productivity enhancing Impacts of the Minimum Wage: Lessons from Denmark, New Zealand and Ireland

Colm McLaughlin

Working Papers from Centre for Business Research, University of Cambridge

Abstract: There has been increasing interest of late in the question of whether minimum wage regulations can raise productivity through the 'shock effect'. This paper explores this question in comparative perspective, by examining the impact of minimum wage regulations and institutions in Denmark, New Zealand and Ireland. It argues that while they are important, a supportive institutional framework plays a far more crucial role in providing coordinated solutions to issues of market failure, such as inadequate levels of training. The paper suggests that sectoral bargaining institutions in low-paid sectors may have the potential to facilitate such coordination and enable the high-productivity model to emerge. For the UK context, this raises the question as to whether Wages Councils in a modernised form might have some future role to play.

Keywords: National Minimum Wage; Low pay; Training; Productivity; Labour market coordination; Comparative employment relations. (search for similar items in EconPapers)
JEL-codes: J38 J58 J80 P52 (search for similar items in EconPapers)
Date: 2007-06
New Economics Papers: this item is included in nep-eec and nep-lab
Note: PRO-2
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:cbr:cbrwps:wp342

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