Publication . Preprint . 2013

Minimum Wages and Regional Disparity: An analysis on the evolution of price-adjusted minimum wages and their effects on firm profitability (Japanese)

Name: Minimum Wages and Regional Disparity: An analysis on the evolution of price-adjusted minimum wages and their effects on firm profitability (Japanese)
Creator: MORIKAWA Masayuki

MORIKAWA Masayuki;

Open Access

Published: 01 Mar 2013

- Summary
- References
  (28)

Abstract

This paper, using prefecture level panel data, empirically analyzes 1) the recent evolution of price-adjusted regional minimum wages and 2) the effects of minimum wages on firm profitability. As a result of rapid increases in minimum wages in the metropolitan areas since 2007, the regional disparity of nominal minimum wages has been widening. However, the disparity of price-adjusted minimum wages has been shrinking. According to the analysis of the effects of minimum wages on profitability using firm level panel data, higher minimum wages reduce firms' profit rate. This negative effect of minimum wages on profitability is pronounced among firms of lower mean wage levels. The results suggest that overinflated minimum wages may adversely affect regional economic activities.

28 references, page 1 of 3

〔参照文献〕（英文） Aaronson, Daniel, Eric French, and James MacDonald (2008), “The Minimum Wage, Restaurant Prices, and Labor Market Structure,” Journal of Human Resources, Vol. 43, No. 3, pp.

Abel, Jaison R., Ishita Dey, and Todd M. Gabe (2012), “Productivity and the Density of Human Capital,” Journal of Regional Science, Vol. 52, No. 4, pp. 562-586. [OpenAIRE]

Brown, Charles (1999), “Minimum Wages, Employment and the Distribution of Income,” in O.

Ashenfelter and D. Card eds. Handbook of Labor Economics, Vol.3B, Amsterdam: North holland, Ch. 32.

Card, David and Alan B. Krueger (1995), “How Much Do Employers and Shareholders Lose?” in David Card and Alan B. Krueger eds. Myth and Measurement: The New Economics of the Minimum Wage, Princeton University Press, Ch. 10, pp. 313-354.

Draca, Mirko, Stephen Machin, and John Van Reenen (2011), “Minimum Wages and Firm Profitability,” American Economic Journal: Applied Economics, Vol. 3, No. 1, pp. 129-151.

Glaeser, Edward L., and Joshua D. Gottlieb (2009), “The Wealth of Cities: Agglomeration Economies and Spatial Equilibrium in the United States,” Journal of Economic Literature, Vol. 47, No. 4, pp. 983-1028.

Glaeser, Edward L. and Matthew G. Resseger (2010), “The Complementarity between Cities and Skills,” Journal of Regional Science, Vol. 50, No. 1, pp. 221-244.

Hirsch, Barry T., Bruce E. Kaufman, and Tetyana Zelenska (2011), “Minimum Wage Channels of Adjustment,” IZA Discussion Paper, No. 6132.

Kambayashi, Ryo, Daiji Kawaguchi, and Ken Yamada (2010), “The Minimum Wage in a Deflationary Economy: The Japanese Experience, 1994-2003,” IZA Discussion Paper, No. [OpenAIRE]

See an issue? Give us feedback