Minimum wage hikes and the wage growth of low-wage workers

Joanna Swaffield ()

Discussion Papers from Department of Economics, University of York

Abstract: This paper presents difference-in-differences estimates of the impact of the British minimum wage on the wage growth of low-wage employees. Estimates of the probability of low-wage employees receiving positive wage growth have been significantly increased by the minimum wage upratings or hikes. However, whether the actual wage growth of these workers has been significantly raised or not depends crucially on the magnitude of the minimum wage hike considered. Findings are consistent with employers complying with the legally binding minimum wage but holding down or offsetting the wage growth that they might have awarded in periods of relatively low minimum wage hikes.

Keywords: Minimum wages; wage growth; difference-in-differences estimator; measurement error (search for similar items in EconPapers)
JEL-codes: J31 J38 (search for similar items in EconPapers)
Date: 2012-04
New Economics Papers: this item is included in nep-lab and nep-lma
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Persistent link: https://EconPapers.repec.org/RePEc:yor:yorken:12/10

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