Prevailing Wage Laws and Construction Labor Markets

Daniel P. Kessler and Lawrence Katz

No 7454, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Prevailing wage laws, which require that construction workers employed by private contractors on public projects be paid at least the wages and benefits that are "prevailing" for similar work in or near the locality in which the project is located, have been the focus of an extensive policy debate. We find that the relative wages of construction workers decline slightly after the repeal of a state prevailing wage law. However, the small overall impact of law repeal masks substantial differences in outcomes for different groups of construction employees. Repeal is associated with a sizeable reduction in the union wage premium and a significant narrowing of the black/nonblack wage differential for construction workers.

Date: 1999-12
New Economics Papers: this item is included in nep-lab and nep-law
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Published as Daniel P. Kessler & Lawrence F. Katz, 2001. "Prevailing wage laws and construction labor markets," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 54(2), pages 259-274, January.

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Journal Article: Prevailing Wage Laws and Construction Laborc Markets (2001)
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