This paper provides a theoretical analysis of optimal minimum wage policy in a perfectly competitive labor market. We show that a binding minimum wage – while leading to unemployment – is nevertheless desirable if the government values redistribution toward low wage workers and minimum wage induced unemployment hits the lowest surplus workers first. This result remains true in the presence of o...

Globalization may have different impacts on the gender wage gap depending on the specialization and trade pattern as well as the socio-economic situation. The main purpose of this paper is to examine an impact of globalization on gender wage inequality. Specifically, the hypothesis is that globalization reduces gender wage gap. For this, we have employed a panel technique for 21 selected develo...

This pooled, cross-sectional, time-series study assesses the impact of health system variables on the relationship between wage inequality and infant mortality in 19 OECD countries over the period 1970-1996. Data are derived from the OECD, World Value Surveys, Luxembourg Income Study, and political economy databases. Analyses include Pearson correlation and fixed-effects multivariate regression...

Discussion Papers are intended to make results of ZEW research promptly available to other economists in order to encourage discussion and suggestions for revisions. The authors are solely responsible for the contents which do not necessarily represent the opinion of the ZEW. This study joins the literature which investigates the empirical relevance of prominent explanations for wage rigidity, ...

This paper demonstrates that the standard search and matching models of equilibrium unemployment, once properly calibrated, can generate only a tiny amount of frictional wage dispersion, i.e., wage differentials among ex-ante similar workers induced purely by search frictions. The analysis is centered around a specific measure of wage dispersion— the ratio between the average wage and the lowes...

Under the Soviet-based system, countries in Central and Eastern Europe were among those with the most equal distributions of income in the world. A greater income inequality was therefore an expected outcome of a transition to a market economy. After 5-7 years of observations on the transition, two models of the process have emerged within the former Soviet bloc: one in Russia and other newly i...