The Minimum Wage Effects on Earnings and Sorting

Suphanit Piyapromdee, Tanisa Tawichsri and Nada Wasi

No 222, PIER Discussion Papers from Puey Ungphakorn Institute for Economic Research

Abstract: We study Thailand’s 2012–2013 nationwide minimum-wage reform, which raised wage floors by over 40 percent. Using matched employer–employee data and a discrete-type model of wages and mobility, we estimate effects on earnings, employment, and sorting. Earnings rise sharply at the bottom with spillovers above the new minimum; employment effects are modest and concentrated among the long-term non-employed. Simulations show sizable lifetime-earnings gains, mainly from higher wages and mobility for high-turnover workers. Entry wages rise for low- and mid-wage workers, but tenure growth flattens most for mid-wage workers. Assortative matching weakens, and wage-based upgrading need not align with revealed job preferences.

Keywords: Minimum wage; Worker–firm sorting; Job mobility; Wage dynamics; Matched employer–employee data; Revealed preferences; Lifetime earnings (search for similar items in EconPapers)
JEL-codes: J31 J38 J60 J64 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2024-10, Revised 2026-02
New Economics Papers: this item is included in nep-lma and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.pier.or.th/files/dp/pier_dp_222.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pui:dpaper:222

Ordering information: This working paper can be ordered from
https://www.pier.or.th/en/dp/222/

Access Statistics for this paper

More papers in PIER Discussion Papers from Puey Ungphakorn Institute for Economic Research Contact information at EDIRC.
Bibliographic data for series maintained by ().