The Unemployment Effects of Minimum Wages

Gary S. Fields, Stephen Bazen
1994 International journal of manpower  
Analyses the effect of a minimum wage on unemployment. Using a model with covered and non-covered sectors, comparative static analysis is performed with respect to the elasticity of demand for labour in the covered sector, the elasticity of the wage in the non-covered sector with respect to the size of the non-covered sector labour force, and the size of the minimum wage. It turns out, contrary to the existing literature, that for none of these parameters is the comparative static effect unidirectional.
doi:10.1108/01437729410059323 fatcat:arrruw774bdsjd6yajpxkomgnq