Fairris, David and Popli, Gurleen and Zepeda, Eduardo (2006): Minimum wages and wage structure in Mexico. Forthcoming in: Review of Social Economy
Download (375kB) | Preview
Instead of merely setting a lower bound on the wages of formal sector workers, minimum wages serve as a norm for wage setting more generally throughout the Mexican economy. Our results suggest that wages are commonly set at multiples of the minimum wage, and that changes in minimum wages influence wage changes across the occupational distribution. Moreover, our findings suggest that these normative features of minimum wages have their greatest impact on the mid-to-lower tail of the wage distribution, including the informal sector of the economy. Thus, the results lend support to the view that declining real minimum wages and stabilization programs that strengthened the link between wage levels, wage changes, and minimum wages, might account for a portion of the growing wage inequality in Mexico over the period of the late 1980s and early 1990s.
|Item Type:||MPRA Paper|
|Original Title:||Minimum wages and wage structure in Mexico|
|Keywords:||wage distributions; minimum wages; wage inequality; Mexico|
|Subjects:||J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J31 - Wage Level and Structure; Wage Differentials
J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J38 - Public Policy
|Depositing User:||Gurleen Popli|
|Date Deposited:||11. Oct 2006|
|Last Modified:||14. Feb 2013 12:00|
Akerlof, G.A. (1982) “Labor Contracts as Partial Gift Exchange,” Quarterly Journal of Economics 97 (4): 543-569. Alarcón, D. and McKinley T. (1997) “The Paradox of Narrowing Wage Differentials and Widening Wage Inequality in Mexico,” Development and Change 28(3): 505-30. Bair, J. and Gereffi G. (2001) “Local Clusters in Global Chains: The Causes and Consequences of Export Dynamism in Torreon’s Blue Jeans Industry,” World Development 29(11): 1885-1903. Behram, J. R., Birdsall N. and Szekely M. (2000) “Economic Reforms and Wage Differentials in Latin America,” Working paper, Inter-American Development Bank. Bell, L. A. (1997) “The Impact of Minimum Wages in Mexico and Colombia,” Journal of Labor Economics 15 (3): S102-S135. Bravo, D. and Vial J. (1997) “La fijacion del salario minimum en Chile,” Estudios Cieplan 45: 117-152. Brown, C. (1999). “Minimum Wages, Employment, and the Distribution of Income,” in O. Ashenfelter and D. Card (eds.) Handbook of Labor Economics vol. 3, Elsevier. Castellanos, S.G., Garcia-Verdu R. and Kaplan D.S. (2004) “Nominal Wage Rigidities in Mexico: Evidence From Social Security Records,” NBER working paper no. 10383. Card, D. and Krueger A.B. (1995) Myth and Measurement: The New Economics of the Minimum Wage, Princeton: Princeton University Press. Cortez, W. W. (2001) “What is Behind Increasing Wage Inequality in Mexico,” World Development 29 (11): 1905-1922. DiNardo, J., Fortin N.M., and Lemieux T. (1996) “Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach,” Econometrica 64(5): 1001-1044. Fairris, D. (2003) “Unions and Wage Inequality in Mexico,” Industrial and Labor Relations Review 56(3): 481-97. Feliciano, Z. M. (1998) “Does the Minimum Wage Affect Employment in Mexico,” Eastern Economic Journal 24 (2): 165-180. Fortin, N.M., and Lemieux T. (1997) “Institutional Changes and Rising Wage Inequality: Is There a Linkage?” The Journal of Economic Perspectives 11 (2): 75-96. Freeman, R.B. (1993) “Labor Market Institutions and Policies: Help or Hindrance to Economic Development?” in Proceedings of the World Bank Annual Conference on Development Economics 1992, Washington, D.C.: The World Bank. Grossman, J.B. (1983) “The Impact of the Minimum Wage on Other Wages,” Journal of Human Resources 18(3): 359-78. INEGI, 1992. Encuesta National de Ingresos y Gastos de los Hogares (ENIGH). Mexico City, INEGI. Levin-Waldman, O.M. (2002) “The Minimum Wage and Regional Wage Structure: Implications for Income Distribution,” Journal of economic Issues XXVI (3): 635-657. Lustig, Nora (1998) Mexico: The Remaking of an Economy (second edition) Brookings Institution Press, Washington D.C.. Maloney, W., and Nuñez J. (2003) “Measuring the Impact of Minimum Wages: Evidence from Latin America,” in J. Heckman and C. Pages (eds.) Law and Employment: Lessons from Latin America and the Caribbean, Chicago: The University of Chicago Press: 109-130. Messmacher, M. (2002) “Stabilization Policies in Mexico, 1982-2000,” in Stabilization and Monetary Policy: The International Experience, Banco de Mexico, Mexico D.F.: 309-347. Neumark, D., Schweitzer M. and Wascher W. (2000) “The Effects of Minimum Wages throughout the Wage Distribution,” The Journal of Human Resources 39 (2): 425-450. Pagan, A., and Ullah A. (1999) Nonparametric Econometrics, Cambridge University Press. Pollin, R., and Luce S. (1998) The Living Wage: Building a Fair Economy New York: New Press. Prasch, R.E, and Sheth F.A. (1999) “The Economics and Ethics of Minimum Wage Legislation,” Review of Social Economy 57(4): 466-487. Robinson, T. (2004) “Hunger Discipline and Social Parasites: The Political Economy of the Living Wage,” Urban Affairs Review 40(2): 246-268. Woodruff, C. (1999) “Inflation Stabilization and the Vanishing Size-Wage Effect,” Industrial and Labor Relations Review 53(1): 103-22.