It also wants to promote regional wage differentials and to reform labour law more generally.

ECONOMIST: Room for improvement

Germany's system of centralised pay bargaining, under which unions and bosses set wages and hours across whole industries, makes matters worse by compressing wage differentials.

ECONOMIST: Wirtschaftsblunder

The euro can be saved, at least for a while, Tory bigwigs believe, but the costs will be high: new institutions, fiscal transfers and sharper wage differentials.

ECONOMIST: Bagehot

Wage differentials are relatively small in the public sector.

ECONOMIST: Public-sector workers

Unions have suppressed wage differentials in the public sector.

ECONOMIST: Public-sector workers

The first is regression analysis, which seeks to measure whether an outcome, such as wage differentials between blacks and whites, is correlated with race once all other relevant factors, such as education and experience, are taken into account.

ECONOMIST: Race, sex and the dismal science | The

Suppose a high minimum wage, by pressing on the structure of pay differentials, raises wage growth and hence inflation across the economy.

ECONOMIST: Economics focus

At other firms, skill differentials will eventually ripple through the wage structure based on the new minimum wage for unskilled workers.

FORBES: The Minimum Wage: More Baloney

Where would the cash for maintaining differentials come from, if the minimum wage were set high?

ECONOMIST: The minimum wage

So restoring differentials would roughly double the direct cost of the minimum wage.

ECONOMIST: The minimum wage