Estimating the Causal Effect of Enforcement on Minimum Wage Compliance : The Case of South Africa
This paper attempts to estimate the causal effect of government enforcement on compliance with minimum wages in South Africa, a country where considerable non-compliance exists. The number of labour inspectors per capita is used as a proxy for enforcement, whilst non-compliance is measured using an index of violation that measures both the proportion of individuals violated, as well as the average depth of individual violation. Due to the potential simultaneity between enforcement and compliance, the number of labour inspectors is instrumented by the number of non-inspectors. The results suggest that there are a variety of factors impacting on violation, including firm-level, sectoral and spatial characteristics. One of the key determinants of violation is found to be the local unemployment rate. However, the number of labour inspectors is found to be insignificant in determining non-compliance.
|Date of creation:||Nov 2011|
|Date of revision:|
|Publication status:||Published in Working Paper Series by the Development Policy Research Unit, November 2011, pages 1-17|
|Contact details of provider:|| Postal: Private Bag X3, Rondebosch, 7701|
Phone: +27 21 650 5705
Fax: +27 21 650 5711
Web page: http://www.dpru.uct.ac.za
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Steven D. Levitt, 1995.
"Using Electoral Cycles in Police Hiring to Estimate the Effect of Policeon Crime,"
NBER Working Papers
4991, National Bureau of Economic Research, Inc.
- Levitt, Steven D, 1997. "Using Electoral Cycles in Police Hiring to Estimate the Effect of Police on Crime," American Economic Review, American Economic Association, vol. 87(3), pages 270-90, June.
- William F. Maloney & Jairo Nunez Mendez, 2003.
"Measuring the Impact of Minimum Wages: Evidence from Latin America,"
NBER Working Papers
9800, National Bureau of Economic Research, Inc.
- William Maloney & Jairo Mendez, 2004. "Measuring the Impact of Minimum Wages. Evidence from Latin America," NBER Chapters, in: Law and Employment: Lessons from Latin America and the Caribbean, pages 109-130 National Bureau of Economic Research, Inc.
- Maloney, William F. & Nunez, Jairo & Cunningham, Wendy & Fiess, Norbert & Montenegro, Claudio & Murrugarra, Edmundo & Santamaria,Mauricio & Sepulveda, Claudia, 2001. "Measuring the impact of minimum wages : evidence from Latin America," Policy Research Working Paper Series 2597, The World Bank.
- Haroon Bhorat & Ravi Kanbur & Natasha Mayet, 2011.
"Minimum Wage Violation in South Africa,"
11143, University of Cape Town, Development Policy Research Unit.
- Lucas Ronconi, 2010. "Enforcement and Compliance with Labor Regulations in Argentina," ILR Review, Cornell University, ILR School, vol. 63(4), pages 719-736, July.
- Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-66, May.
- Lucas Ronconi, 2012. "Globalization, Domestic Institutions, and Enforcement of Labor Law: Evidence from Latin America," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 51(1), pages 89-105, 01.
When requesting a correction, please mention this item's handle: RePEc:ctw:wpaper:11145. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Waseema Petersen)
If references are entirely missing, you can add them using this form.