Who Gain and Lose from the Minimum Wage Policy?

Mohd Yusof Saari (), Azman Hassan () and Rusmawati Said ()
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Mohd Yusof Saari: Department of Economics Faculty of Economics and Management Universiti Putra Malaysia
Azman Hassan: Department of Economics Faculty of Economics and Management Universiti Putra Malaysia
Rusmawati Said: Department of Economics Faculty of Economics and Management Universiti Putra Malaysia

Jurnal Ekonomi Malaysia, 2013, vol. 47, issue 2, 173-182

Abstract: Jurnal Ekonomi Malaysia 47(2) 2013 173 - 182 Who Gain and Lose from the Minimum Wage Policy? (Siapa Untung dan Rugi daripada Dasar Upah Minimum?) Mohd Yusof Saari Azman Hassan Rusmawati Said Faculty of Economics and Management Universiti Putra Malaysia AABSTRACT This study examines the effectiveness of the minimum wage as a mechanism for income redistribution among major ethnic groups in Malaysia. Taking into consideration the benefits and costs of minimum wage, the results show that the wage policy potentially boosts the incomes of ethnic Indians and ethnic Malays, whereas the wage policy marginally affects ethnic Chinese. The estimates also do not provide strong support for the notion that minimum wage legislation in Malaysia is likely to be an effective policy for income redistribution. The effectiveness of the minimum wage legislation is constrained by its limitation to account for informal sector workers.

Keywords: Minimum wage; ethnic groups; income distribution; input-Output (search for similar items in EconPapers)
Date: 2013
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