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The Impact of a Minimum Wage Increase on Employment, Wages and Expenditures of Low-Wage Workers in Vietnam

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  • Nguyen Viet, Cuong

Abstract

This study provides empirical evidence on the impact of a minimum wage increase on employment, wages, and expenditures of workers in the formal sector who have wages below the minimum level in Vietnam. Using the difference-in-differences with propensity score matching and Vietnam Household Living Standard Surveys 2004 and 2006, the paper finds that the minimum wage increase reduced employment of low-wage workers in the formal sector. However, workers who lost formal sector jobs were able to find jobs in the informal sector. The effect of the minimum wage increase on wages and expenditures of workers is not statistically significant.

Suggested Citation

  • Nguyen Viet, Cuong, 2010. "The Impact of a Minimum Wage Increase on Employment, Wages and Expenditures of Low-Wage Workers in Vietnam," MPRA Paper 36751, University Library of Munich, Germany, revised 15 Aug 2011.
    • Handle: RePEc:pra:mprapa:36751
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    References listed on IDEAS

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    2. Cuong Nguyen, 2012. "Do minimum wage increases cause inflation? evidence from vietnam," Economics Bulletin, AccessEcon, vol. 32(1), pages 1-9.
    3. Nguyen, Cuong, 2012. "Do Minimum Wages Affect Firms’ Labor and Capital? Evidence from Vietnam," MPRA Paper 48656, University Library of Munich, Germany.
    4. Cuong Viet Nguyen, 2017. "Do minimum wages affect firms’ labor and capital? Evidence from Vietnam," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 22(2), pages 291-308, April.

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    More about this item

    Keywords

    Minimum wage; employment; income; Vietnam; difference-in-differences; propensity score matching;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

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