Chang, Yang-Ming; Walia, Bhavneet - In: Economics Bulletin 10 (2007) 4, pp. 1-7
This paper presents a simple model to characterize the discriminatory behavior of a non-complying firm in a minimum-wage economy. In the analysis, the violating firm pays one “favored” group of workers the statutory minimum and the other “non-favored” group of workers a sub-minimum. We...