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Estimating the Impact of the Minimum Wage Using Geographical Wage Variation

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  • Mark B. Stewart

Abstract

This paper evaluates the impact on employment of the UK's introduction of a minimum wage in 1999 by exploiting the geographical variation in wages, which meant that the minimum wage's ‘bite’ into an area's wage distribution differed considerably across the country. The results indicate that, although the minimum wage had differential wage‐distribution effects across the 140 areas of the country, employment growth after its introduction was not significantly lower in areas of the country with a high proportion of low‐wage workers, whose wages had to be raised to comply, from that in areas with a low proportion of such workers.

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  • Mark B. Stewart, 2002. "Estimating the Impact of the Minimum Wage Using Geographical Wage Variation," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(supplemen), pages 583-605, December.
    • Handle: RePEc:bla:obuest:v:64:y:2002:i:supplement:p:583-605
    DOI: 10.1111/1468-0084.64.s.2
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    References listed on IDEAS

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    1. David Card, 1992. "Using Regional Variation in Wages to Measure the Effects of the Federal Minimum Wage," Working Papers 680, Princeton University, Department of Economics, Industrial Relations Section..
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    10. Mark B. Stewart, 2004. "The Impact of the Introduction of the U.K. Minimum Wage on the Employment Probabilities of Low-Wage Workers," Journal of the European Economic Association, MIT Press, vol. 2(1), pages 67-97, March.
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