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Minimum Wages and Employment: Comment

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  • Ian Watson

Abstract

Does increasing the minimum wage lead to employment losses? For many years most economists thought that the answer to this was a straightforward 'yes'. However, research during the 1990s began to overturn this conventional wisdom and showed that increases in the minimum wage did not automatically lead to employment losses. A recent Australian study, by Leigh (2003), examined the impact of statutory minimum wages in Western Australia and reached conclusions which supported the conventional view. However, close scrutiny of Leigh's article shows that it is fundamentally flawed. Despite Leigh's efforts, it remains the case that we simply do not know a great deal about the employment impact of Australia's system of minimum wages. Copyright 2004 The University of Melbourne, Melbourne Institute of Applied Economic and Social Research.

Suggested Citation

  • Ian Watson, 2004. "Minimum Wages and Employment: Comment," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 37(2), pages 166-172, June.
  • Handle: RePEc:bla:ausecr:v:37:y:2004:i:2:p:166-172
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    Cited by:

    1. Wang‐Sheng Lee & Sandy Suardi, 2011. "Minimum Wages and Employment: Reconsidering the Use of a Time Series Approach as an Evaluation Tool," British Journal of Industrial Relations, London School of Economics, vol. 49(Supplemen), pages 376-401, July.
    2. Mark Wooden, 2006. "Implications of Work Choices Legislation," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 13(2), pages 99-116.
    3. Jellal, Mohamed, 2012. "Maroc salaire minimum emploi et pauvreté
      [Morocco minimum wage employment and poverty]
      ," MPRA Paper 38491, University Library of Munich, Germany.
    4. Junankar, Pramod N. (Raja), 2014. "The Impact of the Global Financial Crisis on Youth Labour Markets," IZA Discussion Papers 8400, Institute for the Study of Labor (IZA).

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