The Effects of Minimum Wages on Employment and Wages:
tempEvidence from a Natural Experiment in China
By
infection>community responsibilityJing Wang and Morley Gunderson*
(Revid September 2008)
* Jing Wang is a PhD Candidate at the Centre for Industrial Relations and Human Resources at the University of Toronto. Morley Gunderson is the CIBC Professor of Youth Employment at the University of Toronto and a Professor at the Centre for Industrial Relations and Human Resources, the Department of Economics and the School of Public Policy and Governance. He is also a Rearch Associate of the Institute for Policy Analysis, the Centre for International Studies, and the Institute for Human Development, Life Cour and Aging at the University of Toronto. Financial assistance from the Social Sciences and Humanities Rearch Council is gratefully acknowledged, as are comments received at the Conference on 100 Years of Minimum Wage Regulation held at the LSE on December 13 and 14, 2007. [MinWageChinaDifEast809]
The Effects of Minimum Wages on Employment and Wages: Evidence from a Natural Experiment in China
全品作业本答案Abstract
德文翻译在线We u the natural experiment methodology involving difference-in-difference calculations to estimate employment and wage impacts of the new minimum wage initiatives in China – to our knowledge the first such evidence for that country. Overall, minimum wages in China do have an adver employment effect but the effect is statistically insignificant and quantitatively inconquential. The adver employment effects are generally larger in the more market driven ctors, in the low-wage ctor of retail and wholesale trade and restaurants, and for women; however even the effects are extremely small. Minimum wages also had no impact on aggregate wages. The estimates appear consistent with many of tho bad on this natural experiment methodology which tends to find no substantial adver employment effect from minimum wages.
five的序数词1.Introduction
instantcoffee
The debate over the employment and wage impacts of minimum wages has been renewed vigorously over the past decade. The conventional wisdom of a negative impact on employment has
雅思 报名been subject to re-examination. More recent rearch, known as “the new minimum wage rearch”, finds no connsus about the overall effects on employment of an increa in the minimum wage (Neumark & Wascher, 2007). The vast majority of the new rearch, however, has been done in developed countries despite the fact that minimum wages are also widely employed with the intent of raising living standards of low- wage workers in developing countries. Anti-sweatshop campaigns also put pressure on developing countries to rai their minimum wages.
Issues associated with labour markets in countries like China are also attracting incread attention in developed countries. This is highlighted by the title of an article by Richard Freeman (1995): “Are Your Wages Set in Beijing?” The concern from developed countries aris from a number of pressures. Imports of low-wage goods from China are putting pressure on wages at the lower-end of the wage distribution in developed countries, fostering a growing wage inequality. Similar pressures are arising from offshore outsourcing from the developed countries to low-wage countries like China; even the credible threat of such outsourcing can dampen wages in developed countries. There is also the concern that the threat of capital mobility towards such countries as China is putting pressure on governments in developed countries to reduce their regulations, including labour regulations, to attract and retain business investment and the jobs associated with that investment, l
guy
eading to a “race to the bottom” in terms of such regulations that can impact wages and working conditions in
1
developed countries. In such circumstances it is not surprising that labour advocacy groups in developed countries support initiatives that would rai wages in the developing countries. Such initiatives include anti-sweatshop campaigns, imposing labour standards as part of free trade agreements, corporate codes of conduct for multinationals, and minimum wages. Multinational firms themlves often support such policies becau they already tend to meet the standards and so it is desirable to have them impod on their competitors (Gunderson 1999).
allowances
The issue of minimum wages in China itlf is also generating heated debate on the part of tho who support and tho who oppo minimum wages. Advocates argue that in the transition period in which private and foreign companies are growing rapidly and market competition is intensifying, a minimum wage can be important in regulating employers’ behaviours, protecting workers’ interests, improving the quality of labour supply by raising labour standards, and improving managerial efficiency and labour productivity through the pressure from higher labour costs (Sai &Yin 1995). Oth
ers believe that minimum wages can benefit China in the long run by forcing low-productivity, low-technology ctors which rely on low-cost labour to invest in productivity improving technology (Cooke 2005). Following the perspectives, Chine scholars have often focud on ways to t up an ideal minimum wage system since they believe that the minimum wage in China is too low and ineffective (Han & Wei 2005 ).
Opponents of minimum wages contend that they inhibit the development of a market economy during the important transition to such an economy. They argue that under a process of moving towards a market economy, wages should not be an outcome of ‘regulations’ but be determined by market forces. Minimum wage regulations will only lead to unemployment of low-wage workers, reductions in China’s international competitiveness, or substitution
2
