The spatial analysis of the employment effect of the minimum wage in a recession

Abstract

"This report assesses the impact of the National Minimum Wage (NMW) on employment in the UK over the 1999-2010 period explicitly modelling the effect of the 2008-10 recession. Identification is facilitated by using variation in the bite of the NMW across local labour markets with the use of the 'incremental differences-in-differences' (IDiD) estimator. We explicitly take account of the spatial nature of local labour markets by using commuting patterns to weight our estimation. We find that, even controlling for clear regional recessionary factors, there are small positive employment effects of the NMW from 2003-6, when the average bite of the NMW was at its highest since its introduction." (Author's abstract, IAB-Doku) ((en))

Cite article

Dolton, P., Rosazza Bondibene, C. & Stops, M. (2012): The spatial analysis of the employment effect of the minimum wage in a recession. The case of the UK 1999-2010. (Research reports commissioned for the Low Pay Commission Report 2012), London, 61 p.