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Introducing a Statutory Minimum Wage in Middle and Low Income Countries

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  • David Margolis

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, IZA - Institute for the Study of Labor, IZA - Forschungsinstitut zur Zukunft der Arbeit - Institute of Labor Economics)

Abstract

The motivation for introducing statutory minimum wages in many developing countries is often threefold: poverty-reduction, social justice and growth. How well the policy succeeds in attaining these goals will depend on the national context and the numerous choices made when designing the policy. Institutional capacity in developing countries tends to be limited, so institutional arrangements must be adapted. Nevertheless, a statutory minimum wage appears to have the potential to help low- and middle-income countries advance toward the aforementioned development objectives, even in the face of weak enforcement capacity and pervasive informality.

Suggested Citation

  • David Margolis, 2014. "Introducing a Statutory Minimum Wage in Middle and Low Income Countries," PSE - Labex "OSE-Ouvrir la Science Economique" hal-00926545, HAL.
  • Handle: RePEc:hal:pseose:hal-00926545
    Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-00926545
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    References listed on IDEAS

    as
    1. Haroon Bhorat & Ravi Kanbur & Natasha Mayet, 2013. "The impact of sectoral minimum wage laws on employment, wages, and hours of work in South Africa," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-27, December.
    2. William Brown, 2009. "The Process of Fixing the British National Minimum Wage, 1997–2007," British Journal of Industrial Relations, London School of Economics, vol. 47(2), pages 429-443, June.
    3. Catherine SAGET, 2008. "Fixing minimum wage levels in developing countries: Common failures and remedies," International Labour Review, International Labour Organization, vol. 147(1), pages 25-42, March.
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    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Introducing a Statutory Minimum Wage in Middle and Low Income Countries
      by maximorossi in NEP-LTV blog on 2015-09-09 17:25:26

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    1. David N Margolis, 2014. "By Choice and by Necessity: Entrepreneurship and Self-Employment in the Developing World," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 26(4), pages 419-436, September.

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    More about this item

    Keywords

    Minimum wages; development; institutions; enforcement;
    All these keywords.

    JEL classification:

    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market
    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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