The Minimum Wage: An Effective Means to Regain the Electorate's Confidence?

ABSTRACT We analyse the policy feedback on the minimum wage introduction in Germany, which was the core promise of the Social Democrats in the 2013 elections. Overall, there is no positive policy effect on the electorate's preference for the Social Democrats. We find even the contrary: workers earning below the minimum wage tend to give a negative policy feedback in Eastern Germany. Our main estimation strategy exploits the variation of median wages across regions using the Kaitz index. The Difference‐in‐Differences estimations use data from a large household panel. We conclude that the Social Democrats were unsuccessful in regaining the confidence of the electorate through the introduction of the minimum wage.