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The Impact of Minimum Wages on Well-Being: Evidence from a Quasi-experiment in Germany

Filiz Gülal () and Adam Ayaita
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Filiz Gülal: Paderborn University

Journal of Happiness Studies, 2020, vol. 21, issue 7, No 17, 2669-2692

Abstract: Abstract We analyze well-being effects of minimum wages, using the introduction of the minimum wage in Germany as a quasi-experiment. Based on representative data, a difference-in-differences design compares the development of life, job, and pay satisfaction between employees who are affected by the reform according to their pre-intervention wages and those who have marginally higher wages at outset. We find significantly positive effects on all considered dimensions of well-being. The results hold for at least 1 year after the reform, are more pronounced in East Germany, and hold if those who are not employed anymore after the reform are included.

Keywords: Minimum wage; Natural experiments; Well-being; Satisfaction (search for similar items in EconPapers)
JEL-codes: I31 J28 J30 J31 J38 J60 (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1007/s10902-019-00189-5

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