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Impact of Minimum Wages on Exporters: Evidence From a Sharp Minimum Wage Increase in Turkey

Yusuf Emre Akgunduz (), Altan Aldan, Yusuf Bağır () and Huzeyfe Torun ()

Working Papers from Research and Monetary Policy Department, Central Bank of the Republic of Turkey

Abstract: The minimum wages in Turkey rose by nearly 30% in January 2016. We investigate the impact of the increase in minimum wages on export value and prices of firms. We use administrative employee-employer matched firm and transaction level customs data for the analysis. We calculate the potential exposure of each firm to the minimum wage increase according to their 2015 employment records and estimate the effects using a difference-in-differences approach. The results show that there is no significant effect on export prices suggesting that Turkish exporters are price-takers in international trade and producer costs have little effect on export prices in the short run. The impact on export amount is varying across firms depending on the firm size.

Keywords: Minimum wages; Labor costs; Exports (search for similar items in EconPapers)
JEL-codes: J23 J38 F14 (search for similar items in EconPapers)
Date: 2019
New Economics Papers: this item is included in nep-ara, nep-cwa, nep-int and nep-lma
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Persistent link: https://EconPapers.repec.org/RePEc:tcb:wpaper:1920

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