Template-Type: ReDIF-Paper 1.0
Title: Minimum Wages and Insurance Within the Firm 
Author-Name: Effrosyni Adamopoulou
Author-Email: adamopoulou@uni-mannheim.de
Author-Name: Francesco Manaresi
Author-Email: manaresi@gmail.com
Author-Name: Omar Rachedi
Author-Email: omar.rachedi@esade.edu
Author-Name: Emircan Yurdagul
Author-Email: eyurdagu@eco.uc3m.es


Classification-JEL: E24, E25, E64, J31, J38, J52
Keywords: Firm-specific shocks, pass-through, minimum wages, linked employer-employee
data, general equilibrium, complementarities

Abstract: Minimum wages alter the allocation of firm-idiosyncratic risk across workers.
To establish this result, we focus on Italy, and leverage employer-employee data
matched to firm balance sheets and hand-collected wage floors. We find a relatively
larger pass-through of firm-specic labor-demand shocks into wages for
the workers whose earnings are far from the floors, but who are employed by
establishments intensive in minimum-wage workers. We study the welfare implications
of this fact using an incomplete-market model. The asymmetric pass-through
uncovers a novel channel which tilts the benets of removing minimum
wages toward high-paid employees at the expense of low-wage workers.

Note: 
Length: 46
Creation-Date: 2022-01
Revision-Date: 
File-URL: https://www.crctr224.de/research/discussion-papers/archive/dp326
Handle: RePEc:bon:boncrc:CRCTR224_2022_326