Would a legal minimum wage reduce poverty? A microsimulation study for Germany

Arbeitspapier

In view of rising wage inequality and increasing poverty, the introduction of a legal minimum wage has recently become an important policy issue in Germany. We analyze the distributional effects of the introduction of a nationwide legal minimum wage of € 7.5 per hour on the basis of a microsimulation model which accounts for the complex interactions between individual wages, the tax-benefit system and net household incomes. Simulation results show that the minimum wage would be rather ineffective in reducing poverty, even if it led to a substantial increase in hourly wages at the bottom of the wage distribution and had no negative employment effects. The ineffectiveness of a minimum wage in Germany is mainly due to the existing system of meanstested income support.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: DIW Discussion Papers ; No. 791

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Measurement and Analysis of Poverty ; Fiscal Policies and Behavior of Economic Agents: Household ; Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
• Thema: minimum wage, wage distribution ; working poor ; poverty reduction ; microsimulation ; Mindestlohn ; Wirtschaftspolitische Wirkungsanalyse ; Verteilungswirkung ; Armut ; Sozialhilfe ; Bedarfsprinzip ; Deutschland

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Müller, Kai-Uwe ; Steiner, Viktor
• Ereignis: Veröffentlichung
• (wer): Deutsches Institut für Wirtschaftsforschung (DIW)
• (wo): Berlin
• (wann): 2008

Weitere Informationen

• Handle: http://hdl.handle.net/10419/27315
• Letzte Aktualisierung: 10.03.2025, 11:42 MEZ