The effect of doubling the minimum wage on employment: evidence from Russia

Muravyev, Alexander; Oshchepkov, Aleksey

doi:10.1186/s40175-016-0051-0

Cited by 21 publications

(14 citation statements)

References 33 publications

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“…Stringent labor market institutions can incentivize informal employment if they increase the cost of formal job creation. For example, when minimum wages increased in 2007, subsequent increases in informal employment were observed in Russia (Muravyev & Oshchepkov, 2015). More generally however, contrary to the widely held belief that Russia had very rigid employment protection legislation (EPL), internationally comparable estimates showed that Russia's labor law is not particularly restrictive (Lehmann, Muravyev, Razzolini, & Zaiceva, 2013) and (World Bank, 2018).…”

Section: /67mentioning

confidence: 99%

Informal Employment and Worker's Well-Being in the Russian Federation

Kim¹,

Matytsin²,

Freije-Rodríguez³

2019

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The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

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Section: /67mentioning

confidence: 99%

Informal Employment and Worker's Well-Being in the Russian Federation

Kim¹,

Matytsin²,

Freije-Rodríguez³

2019

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“…Given that EITC magnitudes are strongly contingent on the number of children for which an individual holds custodial responsibility, however, their impacts on recidivism are likely 1 Braun (2017) is the closest in spirit to our study; her calibrated model predicts national crime rates initially decreasing with the federal minimum wage, but eventually generating a net increase via disemployment effects. While not explicitly criminal, Muravyev and Oshchepkov (2016) found that a doubling of the Russian minimum wage in 2007 resulted in increased participation in the "informal" labor market.…”

Section: Introductionmentioning

confidence: 99%

The Minimum Wage, EITC, and Criminal Recidivism

Agan

Makowsky

2018

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For recently released prisoners, the minimum wage and the availability of state Earned Income Tax Credits (EITCs) can influence both their ability to find employment and their potential legal wages relative to illegal sources of income, in turn affecting the probability they return to prison. Using administrative prison release records from nearly six million offenders released between 2000 and 2014, we use a difference-indifferences strategy to identify the effect of over two hundred state and federal minimum wage increases, as well as 21 state EITC programs, on recidivism. We find that the average minimum wage increase of $0.50 reduces the probability that men and women return to prison within 1 year by 2.8%. This implies that on average the effect of higher wages, drawing at least some released prisoners into the legal labor market, dominates any reduced employment in this population due to the minimum wage. These reductions in returns to incarcerations are observed for the potentially revenue generating crime categories of property and drug crimes; prison reentry for violent crimes are unchanged, supporting our framing that minimum wages affect crime that serves as a source of income. The availability of state EITCs also reduces recidivism, but only for women.

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“…However, the increase in the minimum wage in these studies is small (less than 5%). 10 Muravyev and Oshchepkov (2015) found that the increase in the minimum wage in Russia decreased employment, especially among youth. In Mexico, however, the doubling of the minimum wage targets a specific region, which allows for a better identification.…”

Section: Minimum Wagementioning

confidence: 99%

The effects of a place-based tax cut and minimum wage increase on labor market outcomes

Campos-Vázquez

Delgado²,

Rodas³

2020

IZA Journal of Labor Policy

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The benefits of place-based policies are still under debate. In this study, we analyze what is probably one of the boldest interventions in the recent history of Mexico and the rest of the world: the Northern Border Free Zone (NBFZ). Launched in January 2019, this program doubles the minimum wage and substantially lowers taxes in 43 municipalities along the border with the United States, aiming to improve living standards for low-wage workers and foster economic activity within the region. Given the unique features of the NBFZ, we estimate its short-run effects on labor outcomes: employment, wages, and formality. Our primary identification strategy follows a synthetic control method employing monthly administrative data at the municipality level for the period 2015–2019. Using administrative data for formal employment, we find that the policy substantially increased labor income in the NBFZ by approximately 9% over the control municipalities. The results for employment are less clear. Formal employment showed 1.6% less growth in the NBFZ than in the control municipalities, but the estimate is imprecise and we cannot reject a null impact of the program on employment. These results are robust to alternative control groups, including metropolitan areas in the United States. We also use the labor force survey to estimate the effects on formality at the individual level and find results closer to a null effect. These two results suggest that the NBFZ did not substantially affect employment, and the intersection of confidence intervals for the two estimates implies a maximum loss of employment of approximately 24,000 jobs.

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The effect of doubling the minimum wage on employment: evidence from Russia

Cited by 21 publications

References 33 publications

Informal Employment and Worker's Well-Being in the Russian Federation

Informal Employment and Worker's Well-Being in the Russian Federation

The Minimum Wage, EITC, and Criminal Recidivism

The effects of a place-based tax cut and minimum wage increase on labor market outcomes

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