60 lines
3.1 KiB
Plaintext
60 lines
3.1 KiB
Plaintext
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author: Eckardt, M. S.
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year: 2022
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title: Minimum wages in an automating economy
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publisher: Journal of public economic theory
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uri: https://doi.org/10.1111/jpet.12528
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pubtype: article
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discipline: economics
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country: United States
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period:
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maxlength: nr
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targeting: explicit
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group: low-skill workers
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data: nr
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design: simulation
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method: task-based framework model
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sample:
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unit:
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representativeness: national
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causal: # 0 correlation / 1 causal
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theory:
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limitations:
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observation:
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- intervention: minimum wage
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institutional: 1
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structural: 1
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agency: 0
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inequality: income
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type: 0 # 0 vertical / 1 horizontal
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indicator: 1 # 0 absolute / 1 relative
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measures: income share (low-skill workers)
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findings: decreases if large displacement effects through machines/high-skill workers
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channels: displacement effects; changed demand; non-flexibility of wages
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direction: -1 # -1 neg / 0 none / 1 pos
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significance: # 0 nsg / 1 msg / 2 sg
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- intervention: minimum wage
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institutional: 1
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structural: 1
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agency: 0
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inequality: income
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type: 0 # 0 vertical / 1 horizontal
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indicator: 1 # 0 absolute / 1 relative
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measures: absolute wages (high-skill/low-skill)
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findings: inequality decreases
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channels:
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direction: # -1 neg / 0 none / 1 pos
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significance: # 0 nsg / 1 msg / 2 sg
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notes: only framework-based not on empirical data
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annotation: |
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A study on the effects of minimum wage on income inequality, taking into account the effects of various kinds of automation within the economy.
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The study considers several types of automation, with automation on the extensive margin (automation of more tasks) leading to decreased wage inequality between low-skill and high-skill earners if it results in decreased overall outputs due to wage compression, and vice versa for increased total outputs.
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Automation on the intensive margin (increased productivity of automating existing tasks) has ambiguous effects on the employment share of low-skill workers (who are possibly displaced) and a higher minimum wage here decreases the inequality between low-skill wages and higher-skill wages.
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However, it may also result in a ripple effect which results in the overall share of income of low-skill workers not increasing, if more machines or high-skill workers displace them.
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Then, while the wage differences may decrease, the low-skill workers share of national income is identified as non-increasing and the share of low-skill employment could decrease.
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The effects on low-skill income share under a system of minimum wage are thus primarily dependent on the amount of low-skill job displacement, as well as the effects of the minimum wage on overall economic output in the first place.
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Ultimately, the author also suggests the institution of low-skill worker training programmes either targeting enhanced productivity for their existing tasks ('deepening skills') or enabling their capability for undertaking tasks previously only assigned to high-skill workers ('expanding skills') which would respectively counteract the negative automation effects on both margins.
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