Spatial Implications of Minimum Wages

Buettner Thiess () and Alexander Ebertz
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Buettner Thiess: Ifo Institute for Economic Research, Poschingerstr. 5, 81679 Munich, Germany
Authors registered in the RePEc Author Service: Thiess Büttner

Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), 2009, vol. 229, issue 2-3, 292-312

Abstract: This paper addresses possible consequences of a minimum wage in a spatial context. An empirical analysis utilizing German data shows that a significant spatial wage structure exists and that, as a consequence, the share of workers earning wages below a minimum wage will be particularly high in rural counties even if we control for educational and occupational differences. A theoretical analysis discusses the implications for the spatial structure of the economy and shows that while the wages in the countryside will be affected positively, wages will decline in the city, where employment and population rise.Workers in the city will further suffer from an increase in housing costs. This supports concerns that urban poverty might increase as a result of the introduction of a minimum wage.

Keywords: Minimum wages; urban poverty; spatial wage structure; mobility; economies of agglomeration; Minimum wages; urban poverty; spatial wage structure; mobility; economies of agglomeration (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (13)

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Working Paper: Spatial Implications of Minimum Wages (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:jns:jbstat:v:229:y:2009:i:2-3:p:292-312

DOI: 10.1515/jbnst-2009-2-313

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