Germany: economic research institutes warn that introducing universal minimum wage would have subversive effects

While the CDU/CSU conservative party and SPD social-democratic party announced, on October 17 after intense preliminary discussions, their will to officially launch, on October 23, talks on the creation of a “grand coalition,” we’re beginning to see the outline of a joint position between the two parties on the central issue of the introduction of universal minimum wage.  Horst Seehofer, leader of the Christian-Social Union (CSU, the CDU’s Bavarian branch), is ready to accept the introduction of universal minimum wage, amounting to €8.5/hour as the SPD requests it, provided that, in return, the social-democrats give up any tax increase.  The same day, four major economic research institutes (DIW, Ifo, RWI and IWH) sounded the alarm and warned that introducing this wage could lead to one million jobs disappearing – which other experts deny.  Overview of a major debate on the German stage.  (Ref.  130635)
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Universal minimum wage, a prerequisite for the SPD. Since the Christian-democratic party of the chancellor, Angela Merkel, and its Bavarian sister, the CSU, started exploratory debates with the social-democratic and green parties to form a coalition, one subject has been at the center of all discussions: should we introduce universal statutory minimum wage? If so, how much? And who should define it: the Parliament, the social partners, or even a committee with independent experts? On...

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