On the Empirics of Minimum Wages and Employment: Stylized Facts for The Austrian Industry

We ask for the empirical evidence of the textbook theory of minimum wages for the Austrian Industry. The bargaining result of unions and firms is interpreted as a minimum wage, as the bargaining situation in Austria may be described best by a "right to manage-model". Based on the analysis of micro-founded "employment functions" in contrast to the predictions of the textbook analysis no significant negative effect of minimum wages on employment is found.Minimum Wages; Employment; Austrian Industry

Minimum Wages in Austria: Estimation of Employment Functions

Minimum wages in Austria are bargaining results between labour unions and entrepreneurs. This paper analyses the empirical effects of minimum wages ("Kollektivvertragslöhne") on employment. "Employment functions", based on a "neo-classical" partial analytic framework, are estimated. The empirical analysis that is done for aggregated Austrian industry and specific branches at first sight seems to support the standard theoretical thesis. In addition, problems caused by the used method, which may occur in similar studies too, are shown. They give rise to the possibility that models of this kind are misspecified.Series: Department of Economics Working Paper Serie

Employment, productivity, output and minimum wage in Austria: a time series analysis

This paper evaluates stylised facts for the Austrian industry. I execute a time series analysis for minimum wage, productivity, output and employment. Tests for cointegration and Granger-causality are done. The results are in contrast to most empirical studies that analyse the empirical effects of minimum wages on employment. Especially no negative impact of minimum wage on employment was found.Series: Department of Economics Working Paper Serie

Mindestlöhne und Beschäftigung: Ein Überblick über die neuere empirische Literatur.

In diesem Beitrag erfolgt ein Überblick über die neuere empirische Literatur zu Beschäftigungswirkungen von Mindestlöhnen. Nach einer einleitenden Diskussion bestehender unterschiedlicher Mindestlohnsysteme und der in der Literatur verwendeten Schätzmethodik zeigt eine Aufstellung der Ergebnisse der neueren Literatur, dass im Gegensatz zu älteren Beiträgen nun grob widersprüchliche Ergebnisse erzielt werden. Neben negativen Beschäftigungswirkungen ist auch Evidenz für keine oder sogar für positive Beschäftigungswirkungen zu finden.Mindestlöhne, Beschäftigungswirkungen

Innovation, Company Co-operation and the Transformation Process in Eastern Europe

Economic theory addresses the scarcity of resources, in particular of physical and human capital, as the underlying reason for inertia in the transformation process in Eastern Europe. In contrast to theory, the empirical dynamics of their growth performance suggests that Central European Economies (CEE) economies have found alternative channels to foster economic growth. Authors suggest that co-operation between Western and Eastern European companies play a key role in understanding the CEE convergence process. Based on a genuinely adopted innovation driven endogenous growth model, expected effects of co-operation between companies in transforming and developed economies are analysed, finding that the opening of the economy and especially company co-operation of Eastern and Western European companies within identical market segments clearly lead to positive growth effects

Ansätze für die österreichsiche Wachstumspolitik

Ausgehend von den konventionellen Ansätzen der Wachstumstheorie, von keynesianischen Ansätzen (Harrod 1939 und Domar 1946) über die neoklassische Modelle (Solow 1956) bis zur endogenen Wachstumstheorie (Romer 1986 und 1990) fußen wachstumspolitische Vorschläge einerseits auf Formen der Investitionsförderung, und andererseits auf der Unterstützung von Bildungs-, Forschungs- und Entwicklungsaktivitäten. Im internationalen Vergleich sind die entsprechenden empirischen Indikatoren allerdings auffallend gering. Somit stellt sich die Frage, worauf die durchaus beachtlichen Wachstumserfolge Österreichs beruhen. In diesem Aufsatz wird in einem theoretischen Ansatz argumentiert, daß die Vertiefung der Arbeitsteilung, die hohe Qualifikation der Facharbeiter/inn/en, die Rolle der aktiven Nachfragesteuerung und die institutionellen Rahmenbedingungen in Österreich hierzu wesentlich beigetragen haben. Aufbauend auf diesen theoretischen Überlegungen wurden - spezifisch für Österreich - wachstumspolitische Reformvorschläge entwickelt, die ausgaben-, vor allem aber nachfrageseitige Orientierung aufweisen. Insbesondere sollten Maßnahmen wie die Förderung der Lehrlingsausbildung und der beruflichen Weiterbildung, der Ausbau des dualen Bildungssystems und aktive Fiskalpolitik basierend auf progressiver Einkommensbesteuerung Erfolge bei der Belebung des Wirtschaftswachstums erzielen.growth; economic policy; Austria

On the empirics of minimum wages and employment. Stylized facts for the Austrian industry.

We investigate the empirical evidence of the "textbook theory" of minimum wages for the Austrian Industry. The bargaining result of unions and firms is interpreted as a minimum wage, as the bargaining situation in Austria may be described best by a "right to manage" model". Based on the analysis of micro-founded "employment functions" in contrast to the predictions of the "textbook analysis" no significant negative effect of minimum wages on employment is found. (author's abstract)Series: Working Papers Series "Growth and Employment in Europe: Sustainability and Competitiveness

Growth theories and the persistence of output fluctuations. The case of Austria.

The paper analyses the degree of output persistence in GDP in order to empirically discriminate between the Solow growth model, the perfect competition endogenous growth model, the imperfect competition endogenous growth model, and the subcase of a multiple equilibria model of endogenous growth for the case of Austria. We find that a temporary shock in the growth rate of output induces a permanent and larger effect on the level of GDP. This leads us to refute the Solow growth model and the perfect competition model. We find strong empirical support for the imperfect competition growth model, but cannot fully rule out the possibility of multiple equilibria growth rates.Series: Department of Economics Working Paper Serie

Economic policy in a model of endogenous growth

We develop a model of endogenous growth based on the division of labour in order to discuss policy issues. The engine of growth is the worker's incentive to achieve higher income, thereby inducing an increase in the degree of specialisation. The genuine contribution of this paper is that both supply side and demand side policies may stimulate long-run economic growth, and do not only induce level shifts. On the supply side, an increase in productivity of innovative workers, alongside with investment in infrastructure, human capital, and improvements in the market setting may stimulate growth. On the demand side, we find that transfers to innovative workers, a reduction in consumption taxes, an increase of labour income taxation of the specialised workforce, and a redistribution towards specialised workers will foster economic growth. (author's abstract)Series: Department of Economics Working Paper Serie

Minimum wages, human capital, employment and growth

This paper deals with the effects of minimum wages on human capital accumulation, and steady state employment and growth. The minimum wage is introduced in a model of endogenous growth driven by human capital accumulation. Unemployed agents maximize utility given the information that they are unemployed facing changed budget constraints. This situation is implemented in a "non-market-clearing equilibrium" framework. We show that the steady state rate of growth is not affected by the minimum wage and that in the steady state the system yields full employment. These effects are generated by intertemporal adjustments of the employed households who re-act to the relatively higher minimum wage which increases skills accumulation. (author's abstract)Security: staffonlySeries: Department of Economics Working Paper Serie