subsidies to low-paid workers. We find that a minimum wage of EUR 7.50 would cost 840,000 low-paid jobs and increase the fiscal … burden by about EUR 4 billion per year, while poor households' income rises only by EUR 1.1 billion per year. With pure wage … subsidies, the government can ensure more favorable employment and income effects. Combining a minimum wage with a wage subsidy …

affects employment, wage inequality, public expenditures, and aggregate income in the low-wage sector. It is shown that a … statutory minimum wage of EUR 7.50 per hour would cost 840,000 low-paid jobs and increases the fiscal burden by about EUR 4 … billion per year, while household income rises only by EUR 1.1 billion per year. Poor households, i.e. those eligible for …

This paper analyzes the effects of introducing a graduated minimum wage in a model with optimal income taxation in …