This paper considers optimal minimum wage policy in a low-ability labor market in the presence of a subsistence allowance and a participation externality. In a market with heterogenous workers and homogeneous low-skilled jobs, a low ability worker's participation decision has a chilling effect...

Without assuming innate differences between genders, we show that the simultaneous interaction between frictional labor and marriage markets can result in a "gendered" equilibrium which is consistent with observed empirical regularities: men earn more than women, and their attachment to the...