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Minimum wage effects across the private and public sectors in Brazil

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  • Sara Lemos

Abstract

Most of the available evidence on the effect of minimum wages concerns the private sector of developed countries. In this paper, we examine minimum wage effects in both private and public sectors for a key developing country. We use monthly data from a Brazilian household survey from 1982 to 2000. We find a strong compression effect in the wage distribution for both the private and public sectors. However, we find no evidence of adverse employment effects in either sector at the aggregate level or for vulnerable groups such as teenagers, women and the low educated. Hence, minimum wage policies in Brazil appear to be a potentially viable anti-poverty instrument.

Suggested Citation

  • Sara Lemos, 2007. "Minimum wage effects across the private and public sectors in Brazil," Journal of Development Studies, Taylor & Francis Journals, vol. 43(4), pages 700-720.
  • Handle: RePEc:taf:jdevst:v:43:y:2007:i:4:p:700-720
    DOI: 10.1080/00220380701259947
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    References listed on IDEAS

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    1. Welch, Finis R & Cunningham, James, 1978. "Effects of Minimum Wages on the Level and Age Composition of Youth Employment," The Review of Economics and Statistics, MIT Press, vol. 60(1), pages 140-145, February.
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    6. 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, vol. 17(1), pages 1-22, January.
    7. Sara Lemos, 2004. "Are Wage and Employment Effects Robust to Alternative Minimum Wage Variables?," Discussion Papers in Economics 04/4, Department of Economics, University of Leicester.
    8. Stephen Machin & Alan Manning & Lupin Rahman, 2003. "Where the Minimum Wage Bites Hard: Introduction of Minimum Wages to a Low Wage Sector," Journal of the European Economic Association, MIT Press, vol. 1(1), pages 154-180, March.
    9. José Márcio Camargo, 1984. "Minimum wage in Brazil theory, policy and empirical evidence," Textos para discussão 67, Department of Economics PUC-Rio (Brazil).
    10. George J. Borjas & Richard B. Freeman, 1992. "Immigration and the Workforce: Economic Consequences for the United States and Source Areas," NBER Books, National Bureau of Economic Research, Inc, number borj92-1.
    11. Burkhauser, Richard V & Couch, Kenneth A & Wittenburg, David C, 2000. "A Reassessment of the New Economics of the Minimum Wage Literature with Monthly Data from the Current Population Survey," Journal of Labor Economics, University of Chicago Press, vol. 18(4), pages 653-680, October.
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    Cited by:

    1. Jhon James Mora & Juan Muro, 2014. "Informality and minimum wages by cohort in Colombia," REVISTA CUADERNOS DE ECONOMÍA, UN - RCE - CID, August.
    2. Patrick Belser & Uma Rani, 2015. "Minimum wages and inequality," Chapters,in: Labour Markets, Institutions and Inequality, chapter 5, pages 123-146 Edward Elgar Publishing.
    3. Haroon Bhorat & Ravi Kanbur & Benjamin Stanwix, 2017. "Minimum Wages in Sub-Saharan Africa: A Primer," World Bank Research Observer, World Bank Group, vol. 32(1), pages 21-74.
    4. Weller, Jürgen, 2007. "La flexibilidad del mercado de trabajo en América Latina y el Caribe. Aspectos del debate, alguna evidencia y políticas," Macroeconomía del Desarrollo 61, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    5. Haroon Bhorat & Ravi Kanbur & Benjamin Stanwix, 2014. "Estimating the Impact of Minimum Wages on Employment, Wages, and Non-Wage Benefits: The Case of Agriculture in South Africa," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 96(5), pages 1402-1419.
    6. Haroon Bhorat & Tara Caetano & Benjamin Jourdan & Ravi Kanbur & Christopher Rooney & Benjamin Stanwix & Ingrid Woolard, 2016. "Investigating the Feasibility of a National Minimum Wage for South Africa," Working Papers 201601, University of Cape Town, Development Policy Research Unit.

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    Keywords

    JEL classification: J38;

    JEL classification:

    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

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