Fairness Perceptions and Reservation Wages?The Behavioral Effects of Minimum Wage Laws*

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Fairness perceptions and reservation wages - the behavioral effects of minimum wage laws

In a laboratory experiment we show that minimum wages have significant and lasting effects on subjects' reservation wages. The temporary introduction of a minimum wage leads to a rise in subjects' reservation wages which persists even after the minimum wage has been removed. Firms are therefore forced to pay higher wages after the removal of the minimum wage than before its introduction. As a c...

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Fairness Perceptions and Reservation Wages— the Behavioral Effects of Minimum

In a laboratory experiment we show that minimum wages have significant and lasting effects on subjects’ reservation wages. The temporary introduction of a minimum wage leads to a rise in subjects’ reservation wages which persists even after the minimum wage has been removed. Firms are therefore forced to pay higher wages after the removal of the minimum wage than before its introduction. As a c...

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ژورنال

عنوان ژورنال: Quarterly Journal of Economics

سال: 2006

ISSN: 0033-5533,1531-4650

DOI: 10.1162/qjec.121.4.1347