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The other margin : do minimum wages cause working hours adjustments for low-wage workers?

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Author Info

  • Stewart, Mark B.

    (Department of Economics, University of Warwick)

  • Swaffield, Joanna K.

    (Department of Economics, University of York)

Abstract

This paper estimates the impact of the introduction of the UK minimum wage on the working hours of low-wage employees using difference-in-differences estimators. The estimates using the employer-based New Earnings Surveys indicate that the introduction of the minimum wage reduced the basic hours of low-wage workers by between 1 and 2 hours per week. The effects on total paid hours are similar (indicating negligible effects on paid overtime) and lagged effects dominate the smaller and less significant initial effects within this. Estimates using the employee-based Labour Force Surveys are typically less significant.

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File URL: http://www2.warwick.ac.uk/fac/soc/economics/research/workingpapers/2008/twerp_746.pdf
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Bibliographic Info

Paper provided by University of Warwick, Department of Economics in its series The Warwick Economics Research Paper Series (TWERPS) with number 746.

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Length: 33 pages
Date of creation: 2006
Date of revision:
Handle: RePEc:wrk:warwec:746

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Keywords: minimum wages ; working hours ; labour demand ; difference-in-differences estimator;

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References

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  1. Kenneth A. Couch & David C. Wittenburg, 2001. "The Response of Hours of Work to Increases in the Minimum Wage," Southern Economic Journal, Southern Economic Association, vol. 68(1), pages 171-177, July.
  2. David Neumark & Mark Schweitzer & William Wascher, 1999. "The effects of minimum wages throughout the wage distribution," Working Paper 9919, Federal Reserve Bank of Cleveland.
  3. Chris Skinner & Nigel Stuttard & Gabriele Beissel-Durrant & James Jenkins, 2002. "The Measurement of Low Pay in the UK Labour Force Survey," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(s1), pages 653-676, 08.
  4. Sara Connolly & Mary Gregory, 2002. "The National Minimum Wage and Hours of Work: Implications for Low Paid Women," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(s1), pages 607-631, 08.
  5. Janet Currie & Bruce C. Fallick, 1996. "The Minimum Wage and the Employment of Youth Evidence from the NLSY," Journal of Human Resources, University of Wisconsin Press, vol. 31(2), pages 404-428.
  6. Mark B. Stewart & Joanna K. Swaffield, 2002. "Using the BHPS Wave 9 Additional Questions to Evaluate the Impact of the National Minimum Wage," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(s1), pages 633-652, 08.
  7. David Card & Alan B. Krueger, 1993. "Minimum Wages and Employment: A Case Study of the Fast Food Industry in New Jersey and Pennsylvania," NBER Working Papers 4509, National Bureau of Economic Research, Inc.
  8. Skinner, Chris, et al, 2002. " The Measurement of Low Pay in the UK Labour Force Survey," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(0), pages 653-76, Supplemen.
  9. Dickens, Richard & Alan Manning, 2003. "The Impact of the National Minimum Wage on the Wage Distribution in a Low-Wage Sector," Royal Economic Society Annual Conference 2003, Royal Economic Society 60, Royal Economic Society.
  10. Mark B. Stewart, 2004. "The employment effects of the national minimum wage," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 114(494), pages C110-C116, 03.
  11. Stewart, Mark B., 2002. "The Impact of the Introduction of the UK Minimum Wage on the Employment Probabilities of Low Wage Workers," Royal Economic Society Annual Conference 2002, Royal Economic Society 169, Royal Economic Society.
  12. Richard Dickens & Alan Manning, 2002. "Has the national minimum wage reduced UK wage inequality?," LSE Research Online Documents on Economics, London School of Economics and Political Science, LSE Library 20079, London School of Economics and Political Science, LSE Library.
  13. William Wascher & David Neumark, 2000. "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania: Comment," American Economic Review, American Economic Association, American Economic Association, vol. 90(5), pages 1362-1396, December.
  14. Thomas R. Michl, 2000. "Can Rescheduling Explain the New Jersey Minimum Wage Studies?," Eastern Economic Journal, Eastern Economic Association, vol. 26(3), pages 265-276, Summer.
  15. Zavodny, Madeline, 2000. "The effect of the minimum wage on employment and hours," Labour Economics, Elsevier, Elsevier, vol. 7(6), pages 729-750, November.
  16. Alan B. Krueger & David Card, 2000. "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania: Reply," American Economic Review, American Economic Association, American Economic Association, vol. 90(5), pages 1397-1420, December.
  17. Dickens, Richard & Machin, Stephen & Manning, Alan, 1999. "The Effects of Minimum Wages on Employment: Theory and Evidence from Britain," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 17(1), pages 1-22, January.
  18. Linneman, Peter, 1982. "The Economic Impacts of Minimum Wage Laws: A New Look at an Old Question," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 90(3), pages 443-69, June.
  19. Bound, John & Brown, Charles & Mathiowetz, Nancy, 2001. "Measurement error in survey data," Handbook of Econometrics, Elsevier, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 59, pages 3705-3843 Elsevier.
  20. Brown, Charles, 1999. "Minimum wages, employment, and the distribution of income," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 32, pages 2101-2163 Elsevier.
  21. Stewart, Mark B, 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(0), pages 583-605, Supplemen.
  22. Machin, Stephen & Alan Manning & Lupin Rahman, 2003. "Where Minimum Wage Bites Hard: The Introduction of the UK National Minimum Wage to a Low Wage Sector," Royal Economic Society Annual Conference 2003, Royal Economic Society 145, Royal Economic Society.
  23. Richard Dickens & Alan Manning, 2004. "Spikes and spill-overs: The impact of the national minimum wage on the wage distribution in a low-wage sector," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 114(494), pages C95-C101, 03.
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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Purnell's market confusion
    by chris dillow in Stumbling and Mumbling on 2010-02-17 13:25:45
  2. Minimum wage: who benefits?
    by chris dillow in Stumbling and Mumbling on 2007-03-07 12:27:08
  3. What do minimum wages do?
    by chris dillow in Stumbling and Mumbling on 2006-10-16 09:23:17
  4. Kinked demand curves
    by chris dillow in Stumbling and Mumbling on 2006-06-12 11:27:19
  5. The Chigley politics of the living wage
    by chris dillow in Stumbling and Mumbling on 2012-11-05 14:40:27
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