The effect of doubling the minimum wage on employment and earnings in Mexico. Raymundo M. Campos-Vazquez. Gerardo Esquivel. Economic Letters. 2021.
Context. 2019 increase in minimum wage in the northern border.
Data. Formal workers in summer 2018.
Methods. Construct trajectories of daily wages of workers from 2015 to 2021, use the municipalities in the northern states that are not in the border as a control group, and use of virtual border municipalities without minimum wage increase as counterfactual.
Conclusions.
- The doubling of the minimum wage in 2019 had no significant effect on employment.
- The increase did raise worker earnings, especially at the bottom of the wage distribution.
