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Minimum Wages, Globalization, and Poverty in Honduras

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  • Katherine Terrell
  • T.H. Gindling

Abstract

To be competitive in the global economy, some argue that Latin American countries need to reduce or eliminate labour market regulations such as minimum wage legislation because they constrain job creation and hence increase poverty. On the other hand, minimum wage increases can have a direct positive impact on family income and may therefore help to reduce poverty. We take advantage of a complex minimum wage system in a poor country that has been exposed to the forces of globalization to test whether minimum wages are an effective poverty reduction tool in this environment.

Suggested Citation

  • Katherine Terrell & T.H. Gindling, 2008. "Minimum Wages, Globalization, and Poverty in Honduras," WIDER Working Paper Series RP2008-23, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:rp2008-23
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    More about this item

    Keywords

    Globalization; Labour law; Poverty; Poverty measurement; Wages;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

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