Gendered Effects of the Minimum Wage

Alessandro Di Nola and Haomin Wang

No E2026/8, Cardiff Economics Working Papers from Cardiff University, Cardiff Business School, Economics Section

Abstract: Women are more likely than men to work in low-hours jobs, which are associated with lower hourly wages and are disproportionately impacted by minimum wage policies. To quantify the gendered effects, we build and estimate an equilibrium search model that incorporates demographic and firm productivity heterogeneity, as well as jobs differing in both wages and hours requirements. The model replicates observed gender gaps in employment, hours worked, and wages, as well as the positive relationship between hours and hourly wages. We implement the minimum wage in our model with a penalty to address non-compliance. Using this framework, we find that Germany's initial €8.5 minimum wage reallocates women toward higher-hours jobs, reducing non-employment. Firm adjustments, however, dampen this effect by raising wages for low-hours jobs, making them relatively more attractive. Enhanced enforcement of the minimum wage amplifies the upward reallocation for women. Finally, we examine the effects of higher minimum wages, finding that increases up to €14 reduce both the gender wage and hours-worked gaps. At €11, 44.8% of the reduction in the gender income gap is attributable to changes in hours worked.

Keywords: Minimum wage; gender gaps; equilibrium job posting; hours requirement (search for similar items in EconPapers)
JEL-codes: E24 E64 J08 J16 J31 (search for similar items in EconPapers)
Pages: 82 pages
Date: 2026-07
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Working Paper: Gendered effects of the minimum wage (2023)
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