Minimum wages: by collective bargaining and by law

This chapter gives a succinct but comprehensive overview of different ways of setting minimum wages in advanced capitalist democracies. The two fundamental options are to establish minimum wages by collective bargaining or by law. But the two options can overlap in different ways. The chapter first presents variation in setting minimum wages by collective bargaining and then variation in statutory minimum wages. In the end it identifies four minimum wage regimes, distinguished by the degree to which minimum wages are based on collective bargaining or statutory law. Over time there has been a trend away from collective bargaining and towards statutory minimum wages. The chapter concludes with important topics for further research on minimum wages.