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Is Minimum Wage An Effective Anti-Poverty Policy In Japan?

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  • Daiji Kawaguchi
  • Yuko Mori

Abstract

This paper considers whether the minimum wage is a well-targeted antipoverty policy by examining the backgrounds of minimum-wage workers. Whether raising the minimum wage reduces employment for unskilled workers is also investigated. An examination of micro data from a large-scale government household survey, the Employment Structure Survey (Shugyo Kozo Kihon Chosa), reveals that approximately half of minimum-wage workers belong to households with annual incomes of more than 5 million yen as a non-head of household. A regression analysis indicates that an increase in the minimum wage moderately reduces the employment of male teenagers and middle-aged married women, while it encourages the employment of high-school age youth. Copyright 2009 The Authors. Journal compilation 2009 Blackwell Publishing Asia Pty Ltd

Suggested Citation

  • Daiji Kawaguchi & Yuko Mori, 2009. "Is Minimum Wage An Effective Anti-Poverty Policy In Japan?," Pacific Economic Review, Wiley Blackwell, vol. 14(4), pages 532-554, October.
  • Handle: RePEc:bla:pacecr:v:14:y:2009:i:4:p:532-554
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    References listed on IDEAS

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    1. David Card, 1992. "Using Regional Variation in Wages to Measure the Effects of the Federal Minimum Wage," Working Papers 680, Princeton University, Department of Economics, Industrial Relations Section..
    2. repec:eee:labchp:v:3:y:1999:i:pb:p:2101-2163 is not listed on IDEAS
    3. David Neumark & Olena Nizalova, 2007. "Minimum Wage Effects in the Longer Run," Journal of Human Resources, University of Wisconsin Press, vol. 42(2).
    4. Charles Brown & Curtis Gilroy & Andrew Kohen, 1983. "Time-Series Evidence of the Effect of the Minimum Wage on Youth Employment and Unemployment," Journal of Human Resources, University of Wisconsin Press, vol. 18(1), pages 3-31.
    5. Brown, Charles, 1999. "Minimum wages, employment, and the distribution of income," Handbook of Labor Economics,in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 32, pages 2101-2163 Elsevier.
    6. Neumark, David & Wascher, William, 1995. "Minimum Wage Effects on Employment and School Enrollment," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(2), pages 199-206, April.
    7. Jesse Rothstein, 2008. "The Unintended Consequences of Encouraging Work: Tax Incidence and the EITC," Working Papers 1049, Princeton University, Department of Economics, Center for Economic Policy Studies..
    8. David Card, 1992. "Using Regional Variation in Wages to Measure the Effects of the Federal Minimum Wage," ILR Review, Cornell University, ILR School, vol. 46(1), pages 22-37, October.
    9. John Kennan, 1995. "The Elusive Effects of Minimum Wages," Journal of Economic Literature, American Economic Association, vol. 33(4), pages 1950-1965, December.
    10. repec:fth:prinin:300 is not listed on IDEAS
    11. Daiji Kawaguchi & Ken Yamada, 2007. "The Impact Of The Minimum Wage On Female Employment In Japan," Contemporary Economic Policy, Western Economic Association International, vol. 25(1), pages 107-118, January.
    12. Ronald G. Ehrenberg & Alan J. Marcus, 1982. "Minimum Wages and Teenagers' Enrollment-Employment Outcomes: A Multinomial Logit Model," Journal of Human Resources, University of Wisconsin Press, vol. 17(1), pages 39-58.
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    Cited by:

    1. Fumio Ohtake & M. Kohara & N. Okuyama & K. Yamada, 2013. "GINI Country Report: Growing Inequalities and their Impacts in Japan," GINI Country Reports japan, AIAS, Amsterdam Institute for Advanced Labour Studies.
    2. repec:eee:labeco:v:47:y:2017:i:c:p:149-162 is not listed on IDEAS
    3. HARA Hiromi, 2015. "The Effects of Minimum Wages on Training," Discussion papers 15075, Research Institute of Economy, Trade and Industry (RIETI).
    4. Abe, Yukiko, 2012. "A cohort analysis of male labor supply in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 26(1), pages 23-43.
    5. Kambayashi, Ryo & Kawaguchi, Daiji & Yamada, Ken, 2013. "Minimum wage in a deflationary economy: The Japanese experience, 1994–2003," Labour Economics, Elsevier, vol. 24(C), pages 264-276.
    6. Kawaguchi, Daiji & Mori, Yuko, 2016. "Why has wage inequality evolved so differently between Japan and the US? The role of the supply of college-educated workers," Economics of Education Review, Elsevier, vol. 52(C), pages 29-50.
    7. Abe, Yukiko, 2013. "Regional variations in labor force behavior of women in Japan," Japan and the World Economy, Elsevier, vol. 28(C), pages 112-124.
    8. repec:siu:wpaper:35-2012 is not listed on IDEAS

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