Restaurant Prices and the Minimum Wage

Denis Fougere, Erwan Gautier and Hervé Le Bihan

No 4070, IZA Discussion Papers from IZA Network @ LISER

Abstract: We examine the effect of the minimum wage on restaurant prices. We contribute to both the study of economic impact of the minimum wage and to the micro patterns of price stickiness. For that purpose, we use a unique dataset of individual price quotes collected to calculate the Consumer Price Index in France and we estimate a price rigidity model based on a flexible (S; s) rule. We find a positive and significant impact of the minimum wage on prices. The effect of the minimum wage on prices is however very protracted. The aggregate impact estimated with our model takes more than a year to fully pass through to retail prices.

Keywords: restaurant prices; price stickiness; minimum wage; inflation (search for similar items in EconPapers)
JEL-codes: D43 E31 L11 (search for similar items in EconPapers)
Pages: 55 pages
Date: 2009-03
New Economics Papers: this item is included in nep-cba, nep-lab, nep-mac and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Published - published in: Journal of Money, Credit and Banking, 2010, 42 (7), 1199-1234

Downloads: (external link)
https://docs.iza.org/dp4070.pdf (application/pdf)

Related works:
Journal Article: Restaurant Prices and the Minimum Wage (2010)
Journal Article: Restaurant Prices and the Minimum Wage (2010)
Working Paper: Restaurant Prices and the Minimum Wage (2009)
Working Paper: RESTAURANT PRICES AND THE MINIMUM WAGE (2008)
Working Paper: Restaurant Prices and the Minimum Wage (2008)
Working Paper: Restaurant Prices and the Minimum Wage (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp4070

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