30,000 Minimum Wages: The Economic Effects of Collective Bargaining Extensions
Pedro Martins
British Journal of Industrial Relations, 2021, vol. 59, issue 2, 335-369
Abstract:
Many governments extend the coverage of collective agreements to workers and employers that were not involved in their bargaining. These extensions may address co‐ordination issues but may also distort competition by imposing sector‐specific minimum wages and other work conditions that are not suitable for some firms and workers. In this article, we analyse the impact of such extensions along several economic margins. Drawing on the worker‐ and firm‐level monthly data for Portugal, a country where extensions have been widespread, and the scattered timing of the extensions, we find that, while continuing workers experience wage increases following an extension, formal employment in the relevant sectors falls, on average, by 2 per cent. These results increase by about 25 per cent across small firms and are driven by reduced hirings. In contrast, the employment and wage bills of independent contractors, who are not subject to labour law or collective bargaining, increase by over 1 per cent following an extension.
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (26)
Downloads: (external link)
https://doi.org/10.1111/bjir.12564
Related works:
Working Paper: 30,000 minimum wages: The economic effects of collective bargaining extensions (2019) 
Working Paper: 30,000 Minimum Wages: The Economic Effects of Collective Bargaining Extensions (2014) 
Working Paper: 30,000 minimum wages: the economic effects of collective bargaining extensions (2014) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:bla:brjirl:v:59:y:2021:i:2:p:335-369
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0007-1080
Access Statistics for this article
British Journal of Industrial Relations is currently edited by Edmund Heery
More articles in British Journal of Industrial Relations from London School of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().