Unemployment not linked to wage dispersion, challenging conventional labor market views.
The article explores the connection between unemployment and wage differences in Germany. One theory suggests that higher minimum wages lead to lower wage differences and more unemployment. Another theory says that more job search difficulties lead to both higher unemployment and wider wage gaps. The study looked at data from West Germany to see which theory fits better. The results show that unemployment is not linked to lower wage differences within specific groups, supporting the idea that job search difficulties affect both unemployment and wage gaps.