TY  - RPRT
        AU  - Alexandre, Fernando
AU  - Bação, Pedro
AU  - Cerejeira, João
AU  - Costa, Hélder
AU  - Portela, Miguel
        TI  - Minimum Wage and Financially Distressed Firms: Another One Bites the Dust
        PY  - 2020/Jul/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 13526
        UR  - https://www.iza.org/publications/dp13526
        AB  - Since late 2014, Portuguese Governments adopted ambitious minimum wage policies. Using linked employer-employee data, we provide an econometric evaluation of the impact of those policies. Our estimates suggest that minimum wage increases reduced employment growth and profitability, in particular for financially distressed firms. We also conclude that minimum wage increases had a positive impact on firms' exit, again amplified for financially distressed firms. According to these results, minimum wage policies may have had a supply side effect by accelerating the exit of low profitability and low productivity firms and, thus, contributing to improve aggregate productivity through a cleansing effect.
        KW  - productivity
KW  - financially distressed firms
KW  - minimum wage
        ER  -