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A Persistence Model of the National Minimum Wage

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Author Info
Melanie K. Jones () (WELMERC, University of Wales at Swansea)
Richard J. Jones () (WELMERC, University of Wales at Swansea)
Philip D. Murphy () (WELMERC, University of Wales at Swansea)
Peter J. Sloane () (WELMERC, University of Wales at Swansea and IZA)

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Abstract

This paper utilises the panel element of the BHPS (waves 9 to 14) to examine the dynamics of the National Minimum Wage (NMW) introduced to Britain in 1999. Specifically a persistence measure based on a random effects probit model for those affected by the NMW is constructed. The conditional probabilities imply some degree of state dependence, but there is also a considerable amount of turnover from one year to the next among those affected by the NMW.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2595.

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Length: 32 pages
Date of creation: Feb 2007
Date of revision:
Handle: RePEc:iza:izadps:dp2595

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Related research
Keywords: National Minimum Wage; state dependence; wage mobility;

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Find related papers by JEL classification:
J0 - Labor and Demographic Economics - - General
J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January. [Downloadable!] (restricted)
  2. Lorenzo Cappellari & Stephen P. Jenkins, 2004. "Modelling Low Pay Transition Probabilities, Accounting for Panel Attrition, Non-Response, and Initial Conditions," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  3. Jeffrey M. Wooldridge, 2005. "Simple solutions to the initial conditions problem in dynamic, nonlinear panel data models with unobserved heterogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(1), pages 39-54. [Downloadable!]
    Other versions:
  4. Lemos, Sara, 2004. "Are Wage and Employment Effects Robust to Alternative Minimum Wage Variables?," IZA Discussion Papers 1070, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  5. Robinson, Helen, 2002. " Wrong Side of the Track? The Impact of the Minimum Wage on Gender Pay Gaps in Britain," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(5), pages 417-48, December. [Downloadable!] (restricted)
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