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 productivity shocks, pass-through, employer-employee data, skill
complementarities, incomplete-market model.

Abstract: Minimum wages generate an asymmetric pass-through of firm shocks across workers.
We establish this result leveraging employer-employee data on Italian metal manufacturing
firms, which face different wage floors that vary within occupations.
In response to negative firm productivity shocks, workers close to the wage
floors experience higher job separations but no wage loss. However, the wage of
high-paid workers decreases, and more so in firms with higher incidence of minimum
wages. A neoclassical model with complementarities across workers with
different skills rationalizes these findings. Our results uncover a novel channel
that tilts the welfare gains of minimum wages toward low-paid workers.

Note: 
Length: 63
Creation-Date: 2022-01
Revision-Date: 
File-URL: https://www.crctr224.de/research/discussion-papers/archive/dp326
Handle: RePEc:bon:boncrc:CRCTR224_2022_326v3