Wage reforms and equality gains: evidence from Greece

Alexandros P. Bechlioulis, Michael Chletsos, Tryfonas Christou and Aikaterini E. Karadimitropoulou

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This paper examines whether minimum wage reforms affect income inequality among low-wage workers. We construct a novel “within-occupation” measure of wage dispersion, using a Greek dataset between 2010 and 2020. Using modern difference-in-differences analysis for causal inference, our findings show non-symmetrical effects on wage dispersion when a minimum wage reform is imposed. In particular, the minimum wage cut of 2012 did not alter the wage dispersion of low-wage workers, while the minimum wage increase of 2019 led to a decrease in wage inequality at the bottom segment of the labor market. Our paper equips policymakers with a solid understanding of the effects of minimum wage reforms on wage inequality and highlights the important role of wage rigidities in shaping these effects.

Keywords: income inequality; wage inequality; minimum wage reform; modern difference-in-difference analysis; quantile regression (search for similar items in EconPapers)
JEL-codes: C31 J08 J31 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2025-07
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:129622

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