Do minimum wage hikes lead to employment destruction? Evidence from a regression discontinuity design in Argentina

Nicolás Abbate and Bruno Jiménez

Journal of Development Economics, 2026, vol. 178, issue C

Abstract: In this study, we examine the impact of eight minimum wage increases in Argentina during the early 21st century by analyzing administrative records of registered employment. Utilizing a regression discontinuity design, we compare job separation rates between a group affected by the minimum wage hikes and a control group slightly out of their legal scope. Our findings indicate that, overall, these minimum wage hikes had no significant impact on separation rates. However, the 2008 increase triggered a 4.8 percentage point (19%) decrease in separations, casting doubt on the disemployment effects of minimum wages. Overall, these findings suggest that during economic upswings, minimum wage increases may have little to no adverse impact on job destruction.

Keywords: Minimum wage; Regression discontinuity design (search for similar items in EconPapers)
JEL-codes: J31 J80 K31 (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:eee:deveco:v:178:y:2026:i:c:s0304387825001099

DOI: 10.1016/j.jdeveco.2025.103558

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