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IZA Discussion Paper No. 17510
December 2024
Labor Market Frictions and Spillover Effects from Publicly Announced Sectoral Minimum Wages

This paper analyzes the horizontal spillover effects of Germany's first sectoral minimum wage. Using a difference-in-differences estimation, I examine the impact of the public announcement and introduction of the minimum wage on sub-minimum wage workers in related jobs outside the minimum wage sector, defined using employment flows. I find an increase in wages and job-to-job transitions for sub-minimum wage workers in related jobs. The spillover effects are driven by workers who reallocate to better-paying establishments, have low labor market experience, and are more closely connected to the minimum wage sector by having former coworkers in that sector.

Kommunikation
Mark Fallak
mark.fallak@liser.lu
+352 585-855-526
World of Labour
Olga Nottmeyer
olga.nottmeyer@liser.lu
+352 585-855-501
Netzwerkkoordination
Christina Gathmann
christina.gathmann@liser.lu

Das IZA@LISER-Netzwerk ist eine weltweite Gemeinschaft für exzellente Forschung in der Arbeitsmarktökonomie und angrenzenden Fachgebieten. Nach dem Wechsel von Bonn wird das Netzwerk nun am Luxembourg Institute of Socio-Economic Research (LISER) koordiniert.

Über das IZA@LISER Network
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