Title page

Contents

Abstract 3

1. Introduction 4

2. Data and Descriptive Results 8

2.1. Data Sources 8

2.2. Treatment Indicator 10

2.3. Descriptive Statistics 10

3. Empirical Approach 14

4. Results 18

4.1. Long-Term Effects of the Minimum Wage Introduction 18

4.2. Effects of the Minimum Wage Increases 21

4.3. Effects of the Minimum Wage for Switching Treatment Groups 24

4.4. Staggered Treatment Adoption 26

4.5. Robustness Analysis 28

4.6. Comparison with the Literature 31

5. Conclusion 32

References 35

Appendix 38

Supplementary Appendix 49

Table 1. Effects of the minimum wage introduction on regional employment 19

Table 2. Effects of the minimum wage introduction and its raises on regional employment 23

Table 3. Effects of the minimum wage introduction on regional employment with multiple treatment groups 25

Figure 1. Regional wage gap to €8.50 in 2014 (left) and to €9.19 in 2018 (right) 12

Figure 2. Treatment groups based on the wage gaps in 2014 and 2018 13

Figure 3. Effect of the minimum wage on employment 20

Figure 4. Effect of the minimum wage on employment interacted with the regional economic growth 22

Figure 5. Effect of the minimum wage on employment with staggered treatment adoption and different estimators 27

Table A.1. Development of the minimum wage level in Germany 39

Table A.2. Descriptive statistics for labour market regions prior to the introduction and the increase of the minimum wage 43

Table A.3. Descriptive statistics for labour market regions grouped according to their treatment status in 2014 and 2018 44

Table A.4. Effects of the minimum wage introduction on regional employment with a continuous treatment variable 45

Table A.5. Effects of the minimum wage introduction on regional employment with a longer pre-treatment period 46

Table A.6. Effects of the minimum wage introduction on regional employment with multiple treatment groups and a bite measure for 2018 that is only updated... 47

Table A.7. Effects of the minimum wage introduction on regional employment with a staggered treatment 48

Table B.1. Results for the Goodman-Bacon decomposition of the TWFE results with a staggered treatment 49

Figure A.1. Wage gap ranks of labour market regions in 2014 and 2018 38

Figure A.2. Outcome evolution over time by treatment status 39

Figure A.3. Effect of the minimum wage on employment with a longer pre-treatment period 40

Figure A.4. Effect of the minimum wage on employment with staggered treatment adoption and different estimators using a bite measure for 2018 that is only updated... 41

Figure A.5. Effect of the minimum wage on employment with staggered treatment adoption without observations that switch from treatment to control group in 2019 42