Are the effects of minimum wage on the labour market the same across countries? A meta-analysis spanning a century

Martínez, Mónica Jiménez; Jiménez, Maribel

doi:10.1016/j.ecosys.2020.100849

Cited by 7 publications

(3 citation statements)

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“…WALS combines idea from Bayesian and frequentist approaches to model averaging (Magnus et al., 2010). There are a lot of recent applications of BMA (e.g., Cardoso et al, 2021; Matousek et al., 2020) and WALS (e.g., Jiménez Martínez & Jiménez Martínez, 2021; Ugur et al., 2020) in meta‐analysis. While in BMA the effect of a moderator is considered not to be weak if the PIP is larger than 0.5 (Kass & Raferty, 1995), in WALS its t ‐value needs to be greater than one in absolute value (De Luca & Magnus, 2011).…”

Section: Resultsmentioning

confidence: 99%

Studying abroad and earnings: A meta‐analysis

Pietro

2021

Journal of Economic Surveys

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The increasing number of university students participating in international mobility programs worldwide calls for a better understanding of the effects of studying abroad. Despite the frequent claim that these programs enhance participants’ labor market prospects, there is no clear consensus in the literature about their impact on earnings. The present article attempts to shed light on this issue by applying meta‐analysis techniques to 166 estimates of returns to studying abroad from 17 studies. Summary measures used in meta‐analysis indicate that participation in study abroad programs during university studies has a small positive effect on post‐graduation earnings. However, due to the high heterogeneity and publication bias, this conclusion should be interpreted very cautiously. Multivariate meta‐regression analysis shows that the omission of relevant variables from the wage equation, the econometric methods employed, and the duration of the study abroad experience contribute to explain variation in the empirical findings.

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Section: Resultsmentioning

confidence: 99%

Studying abroad and earnings: A meta‐analysis

Pietro

2021

Journal of Economic Surveys

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“…Moreover, the meta-study by Hafner et al (2017) [69] indicated no statistically significant aggregate adverse employment effect based on the UK's minimum wage. Closing this meta-analysis review, the studies by Broecke et al (2017) [70] and Gautié and Laroche (2018) [71] pointed to small negative effects, while the negative relationship between minimum wages and employment is more evident in the study by Martínez and Martínez (2021) [72].…”

Section: Meta-analysis On the Employment Effect Of Labor Market Insti...mentioning

confidence: 99%

Labor Market Institutions and Employment

Giotis

2024

Encyclopedia

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The role of labor market institutions and policies has received great attention throughout the history of labor economics. Labor market institutions are responsible for a wide range of policies, regulations, and organizations that affect the labor market, though their impact on employment can vary depending on the specific institutions and the economic context across countries. This entry attempts to provide an overview of five main labor market institutions and policies, i.e., the minimum wage, employment protection, the power of unions, active labor market policies, and unemployment insurance/unemployment benefits. It also presents theoretical expectations of their effects on employment outcomes and collates relevant results from the related literature, focusing mainly on the most recent empirical evidence. Finally, this entry provides insights regarding labor market institutions and offers proposals for shaping the labor market landscape.

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“…, 1982; Doucouliagos and Stanley, 2009) and mainly for estimates obtained for teenagers. Furthermore, disemployment effects seem to appear when authors focus on developed countries, while no effect is seen in developing countries (Jiménez and Jiménez, 2021). Neumark and Munguía Corella (2021) claim that studies with relatively more features, in which institutional factors and the competitive model more strongly predict negative effects, are more likely to show the MW's negative effects in developing countries.…”

Section: Antecedents and Evidence From Previous Meta-analysesmentioning

confidence: 99%

From snapshot to movie: decomposing the minimum wage effects on employment into hirings and separations

Martínez

Jiménez

2023

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PurposeWhile the effect of the minimum wage (MW) on employment has been widely studied, less is known about its impact on hirings and separations. Whereas the adverse effects of MW on hiring are quite familiar, results of studies indicating reductions in separations are less expected. This study aims to bridge the gap between theory and practice by performing a meta-analysis, which allows for understanding the real effect of MW on employment's two components: hirings and separations.Design/methodology/approachSince mixed results cloud understanding of the issue, a meta-regression analysis was conducted. This technique permits understanding the effect of MW on labor market transitions and offers additional explanations for controversial results.FindingsDespite the evidence that MW increasing the turnover and reducing permanence could negatively affect employment, findings from meta-regression analysis pointed out that increases in MW reduce hirings but also separations offsetting the negative effect on employment. Overall, the results imply that the standard finding that MW changes have little or no impact on employment rates reflects offsetting reductions in hiring and separations. Evidence of negative publication bias is also found.Research limitations/implicationsThe results emphasize the importance of looking beyond employment rates to understand the impacts of MW. Overall, the evidence implies that the standard finding that MW changes have little or no impact on employment rates reflects offsetting reductions in hiring and layoffs. In addition, the results suggest that MW tends to have a much larger impact on employment flows than on employment levels. This finding has to be considered by policymakers when they make decisions about increasing the MW. These analyses assist in clarifying debates about the effects of MW on the labor market in the changing economic environment and conduct a labor policy in the right direction.Practical implicationsThe meta-regression analysis (MRA) conducted in this study emphasizes the importance of looking beyond employment rates to understand the impacts of MW (Brochu and Green, 2013). Overall, the evidence implies that the standard finding that MW changes have little or no impact on employment rates reflects offsetting reductions in hiring and layoffs. Therefore, the evidence from the performed MRA is consistent with those previous meta-analysis studies that found little or no evidence about MW adversely affecting employment and, at the same time, provide additional explanation for these findings. In addition, the results suggest that MW tends to have a much larger impact on employment flows than on employment levels (Dube et al., 2016).Social implicationsEven though hirings are reduced due to MW, this evidence could not necessarily imply a negative effect of MW on the labor market since job searching or matching is improved. Additionally, the increases in MW could improve the quality of the job and the job attachment, which are consistent with a recruitment-retention model (Dube et al., 2007). The evidence from this MRA, which is consistent with little or no impact of MW on employment, also could imply that although the MW is set relatively high to balance the supply and demand of labor, their level is close to optimal. Setting the right level is also associated with compliance with MW. This issue deserves attention since any adverse employment effects of MW could be strengthened by incomplete coverage. The effectiveness of the entire process of developing, putting into practice and enforcing MW rules hinges on compliance.Originality/valueAs prior meta-regression analysis did not have the same objective, the results of this article move current research forward. Based on the analysis, future research lines are delineated, and some public policy implications are assessed.

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Are the effects of minimum wage on the labour market the same across countries? A meta-analysis spanning a century

Cited by 7 publications

References 61 publications

Studying abroad and earnings: A meta‐analysis

Studying abroad and earnings: A meta‐analysis

Labor Market Institutions and Employment

From snapshot to movie: decomposing the minimum wage effects on employment into hirings and separations

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