We analyze optimal taxation in an economy with monopsonistic labor markets. The individuals, whose only decisions are whether to work, or not, have heterogeneous productivities and opportunity costs of work. Given its preferences for redistribution, the government, which does not observe the...

Using linked employer-employee data for Portugal, we explore an amendment to the minimum wage law which increased from 75% to 100% of the full minimum wage applied to employees younger than 18. Our results show a widening of the gender wage gap following the amendment: the wage gap for minors...