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Minimum wage introduction and employment: Evidence from South Korea

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  • Baek, Jisun
  • Park, WooRam

Abstract

This paper examines the effect of the introduction of the national minimum wage on plant-level employment in South Korea. We show that the minimum wage introduction increased the average remuneration for employees, but has no discernible effect on plant-level employment.

Suggested Citation

  • Baek, Jisun & Park, WooRam, 2016. "Minimum wage introduction and employment: Evidence from South Korea," Economics Letters, Elsevier, vol. 139(C), pages 18-21.
    • Handle: RePEc:eee:ecolet:v:139:y:2016:i:c:p:18-21
    DOI: 10.1016/j.econlet.2015.12.014
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    References listed on IDEAS

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    1. Arindrajit Dube & Suresh Naidu & Michael Reich, 2007. "The Economic Effects of a Citywide Minimum Wage," ILR Review, Cornell University, ILR School, vol. 60(4), pages 522-543, July.
    2. Barry T. Hirsch & Bruce E. Kaufman & Tetyana Zelenska, 2015. "Minimum Wage Channels of Adjustment," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 54(2), pages 199-239, April.
    3. Mirko Draca & Stephen Machin & John Van Reenen, 2011. "Minimum Wages and Firm Profitability," American Economic Journal: Applied Economics, American Economic Association, vol. 3(1), pages 129-151, January.
    4. 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.
    5. John Schmitt, 2013. "Why Does the Minimum Wage Have No Discernible Effect on Employment?," CEPR Reports and Issue Briefs 2013-04, Center for Economic and Policy Research (CEPR).
    6. Neumark, David & Wascher, William L., 2007. "Minimum Wages and Employment," Foundations and Trends(R) in Microeconomics, now publishers, vol. 3(1–2), pages 1-182, March.
    7. Arindrajit Dube & T. William Lester & Michael Reich, 2010. "Minimum Wage Effects Across State Borders: Estimates Using Contiguous Counties," The Review of Economics and Statistics, MIT Press, vol. 92(4), pages 945-964, November.
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    Citations

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    Cited by:

    1. Bai, Yihong & Kim, Chungah & Chum, Antony, 2023. "Impact of the minimum wage increase on smoking behaviour: A quasi-experimental study in South Korea," Social Science & Medicine, Elsevier, vol. 333(C).
    2. Maitre, Bertrand & McGuinness, Seamus & Redmond, Paul, 2017. "A study of minimum wage employment in Ireland: The role of worker, household and job characteristics," Research Series, Economic and Social Research Institute (ESRI), number BKMNEXT332, June.
    3. McGuinness, Seamus & Redmond, Paul, 2018. "Estimating the effect of an increase in the minimum wage on hours worked and employment in Ireland," Research Series, Economic and Social Research Institute (ESRI), number BKMNEXT354, June.
    4. Ahlfeldt, Gabriel & Roth, Duncan & Seidel, Tobias, 2018. "The regional effects of Germany’s national minimum wage," CEPR Discussion Papers 13005, C.E.P.R. Discussion Papers.
    5. Paul Redmond & Karina Doorley & Seamus McGuinness, 2021. "The impact of a minimum wage change on the distribution of wages and household income," Oxford Economic Papers, Oxford University Press, vol. 73(3), pages 1034-1056.
    6. Ahlfeldt, Gabriel M. & Roth, Duncan & Seidel, Tobias, 2018. "The regional effects of Germany’s national minimum wage," Economics Letters, Elsevier, vol. 172(C), pages 127-130.
    7. Hyunbae Chun & Jungmin Lee & Donghan Shin, 2024. "Does the Minimum Wage Affect Non-wage Workers?," Korean Economic Review, Korean Economic Association, vol. 40, pages 5-47.
    8. Gabriel Ahlfeldt & Duncan Roth & Tobias Seidel, 2018. "The Regional Effects of a National Minimum Wage," CESifo Working Paper Series 6924, CESifo.
    9. Baek, Jisun & Lee, Changkeun & Park, WooRam, 2021. "The impact of the minimum wage on the characteristics of new establishments: Evidence from South Korea," Labour Economics, Elsevier, vol. 72(C).

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    More about this item

    Keywords

    Minimum wage introduction; Difference-in-differences; Employment; Plant-level; South Korea;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

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