Sectoral minimum wages in South Africa: Disemployment by firm size and trade exposure
Marlies Piek and
Dieter von Fintel
Development Southern Africa, 2020, vol. 37, issue 3, 462-482
This paper measures the impact of South African minimum wages on small and large firm employment in a sector that is exposed to international competition (agriculture) and one that is not (retail). Small farm employment is most vulnerable to minimum wage legislation. In contrast, large farm employment was shielded from employment losses. While this shift represents a short-run response to minimum wages, it may intensify the long-run movement towards fewer, larger, and more capital-intensive farms. Retail employment experienced no changes in employment, regardless of firm size. These results are in line with the idea that firms exposed to international markets cannot easily increase prices when their employees’ wages increase while non-tradable sectors can more readily shift the burden of higher labour costs onto consumers by increasing prices. Implementation of a uniform national minimum wage ignores this type of heterogeneity, and could lead to intra-industry changes in concentration and inequality.
References: Add references at CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
Working Paper: Sectoral minimum wages in South Africa: disemployment by firm size and trade exposure (2018)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:taf:deveza:v:37:y:2020:i:3:p:462-482
Ordering information: This journal article can be ordered from
Access Statistics for this article
Development Southern Africa is currently edited by Marie Kirsten
More articles in Development Southern Africa from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().