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The impact of the minimum wage on job separations and working hours among young people in Poland

Author

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  • Anna Baranowska-Rataj

    (Institute of Statistics and Demography, Warsaw School of Economics)

  • Iga Magda

    (Department of Economics, Warsaw School of Economics)

Abstract

The aim of this paper is to investigate the impact of the minimum wage on the risk of job separation and changes in working hours among young people in Poland. To this end, we use longitudinal data from the Labour Force Survey 2003-2011 and a difference-in-differences matching estimator based on the changes in the individual position in the wage distribution. Specifically, we test the impact of the minimum wage by distinguishing between individuals who experienced a transition to the below-the-minimum-wage regime. Our results indicate that when the minimum wage was increased, employment levels, but not the number of hours of worked, declined among young people. We also found that the number of hours worked actually increased among those young people who remained employed after the minimum wage was raised. However, these effects of a hike in the minimum wage were found to have differed across various groups of workers, with men, students, and individuals who were working under a fixed-term contract being most likely to have either lost a job or increased their working longer hours.

Suggested Citation

  • Anna Baranowska-Rataj & Iga Magda, 2015. "The impact of the minimum wage on job separations and working hours among young people in Poland," Working Papers 75, Institute of Statistics and Demography, Warsaw School of Economics.
  • Handle: RePEc:isd:wpaper:75
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    References listed on IDEAS

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    Cited by:

    1. Piotr Lewandowski & Agnieszka Kaminska, 2015. "The effects of minimum wage on a labour market with high temporary employment," IBS Working Papers 7/2015, Instytut Badan Strukturalnych.
    2. Maciej Albinowski & Piotr Lewandowski, 2022. "The heterogeneous regional effects of minimum wages in Poland," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 30(2), pages 237-267, April.
    3. Mayrano Andrianus Sitinjak & Diny Ghuzini, 2023. "Spatial Analysis of Youth Unemployment in Indonesia: Minimum Wages and Industrial Mix," Gadjah Mada Economics Working Paper Series 202308008, Department of Economics, Faculty of Economics and Business, Universitas Gadjah Mada.
    4. repec:ces:ifodic:v:16:y:2019:i:4:p:50000000004807 is not listed on IDEAS
    5. Karolina GORAUS‐TAŃSKA & Piotr LEWANDOWSKI, 2019. "Minimum wage violation in central and eastern Europe," International Labour Review, International Labour Organization, vol. 158(2), pages 297-336, June.
    6. International Monetary Fund, 2016. "Cross-Country Report on Minimum Wages: Selected Issues," IMF Staff Country Reports 2016/151, International Monetary Fund.
    7. Neumark, David & Munguía Corella, Luis Felipe, 2021. "Do minimum wages reduce employment in developing countries? A survey and exploration of conflicting evidence," World Development, Elsevier, vol. 137(C).
    8. Paul Eamets & Amaresh K. Tiwari, 2019. "Minimum Wage in Estonia and its Impact on Employment and Wage Distribution," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 16(04), pages 37-43, January.
    9. Piotr Lewandowski & Iga Magda, 2018. "The labor market in Poland, 2000−2016," IZA World of Labor, Institute of Labor Economics (IZA), pages 426-426, February.

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    More about this item

    Keywords

    minimum wage; youth unemployment; difference-in-differences matching;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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