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Learning to Love the Government: Trade Unions and late Adoption of the Minimum Wage

  • Brett Meyer


One counterintuitive variation in wage-setting regulation is that countries with the highest labor standards and strongest labor movements are among the least likely to set a statutory minimum wage. This, the author argues, is due largely to trade union opposition. Trade unions oppose the minimum wage when they face minimal low-wage competition, which is affected by the political institutions regulating industrial action, collective agreements, and employment, as well as by the skill and wage levels of their members. When political institutions effectively regulate low-wage competition, unions oppose the minimum wage. When political institutions are less favorable toward unions, there may be a cleavage between high- and low-wage unions in their minimum wage preferences. The argument is illustrated with case studies of the UK, Germany, and Sweden. The author demonstrates how the regulation of low-wage competition affects unions’ minimum wage preferences by exploiting the following labor market institutional shocks: the Conservatives’ labor law reforms in the UK, the Hartz labor market reforms in Germany, and the European Court of Justice's Laval ruling in Sweden. The importance of union preferences for minimum wage adoption is also shown by how trade union confederation preferences influenced the position of the Labour Party in the UK and the Social Democratic Party in Germany.



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* I thank Christopher Adolph, John Ahlquist, Alexandra Cirone, Anthony Daniels, Matthew Dimick, Anke Hassel, John Huber, Katherine Jackson, Alexander Kuo, Isabela Mares, Vicky Murillo, Mark Schneider, Dorian Warren, three anonymous reviewers, and the editors of World Politics for helpful written comments and discussion. I also thank participants at the 2014 Midwest Political Science Association Annual Meeting, seminar participants at the London School of Economics and Amherst College, and my colleagues at the 2013–4 Berlin Program for Advanced German and European Studies Colloquium for additional helpful feedback.

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Learning to Love the Government: Trade Unions and late Adoption of the Minimum Wage

  • Brett Meyer


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