Inspections and Compliance: Enforcement of the Minimum-Wage Law - 10.1628/fa-2021-0001 - Mohr Siebeck
Economics

Mattis Beckmannshagen, Alexandra Fedorets

Inspections and Compliance: Enforcement of the Minimum-Wage Law

Section: Articles
FinanzArchiv (FA)

Online First, pp. 1-58 (58)
Published 26.02.2021

46,00 € including VAT
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This paper is the first to empirically study the relationship between spatial distributions of labor market inspections and noncompliance with Germany's minimum-wage law. Combining novel administrative data with large-scale longitudinal survey data, we document that the inspection probability is higher in regions with higher noncompliance. This implies risk-based allocation of the inspection efforts and, hence, its endogeneity. Using fixed effects and an instrumental-variable approach, we show that higher inspection efforts have a limited effect on compliance. Based on a theoretical framework and international evidence, we discuss challenges for law enforcement, the political importance of compliance, and possible improvement measures.
Authors/Editors

Mattis Beckmannshagen No current data available.

Alexandra Fedorets No current data available.