Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/272658 
Year of Publication: 
2023
Series/Report no.: 
IZA Discussion Papers No. 16031
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
A minimum wage increase could lead to adverse employment effects for certain sub-groups of minimum wage workers, while leaving others unaffected. This heterogeneity could be overlooked in studies that examine the overall population of minimum wage workers. In this paper, we test for heterogeneous effects of a minimum wage increase on the hours worked of minimum wage employees in Ireland. For all minimum wage workers, we find that a ten percent increase in the minimum wage leads to a one-hour reduction in weekly hours worked, equating to an hours elasticity of approximately -0.3. However, for industry workers and those in the accommodation and food sector, the impact is larger, with an elasticity of -0.8. We also find a negative impact on the hours worked among men on minimum wage, with no significant effect for women. In line with suggestions from the recent literature, our study uses administrative wage data to accurately identify those in receipt of minimum wage, while also studying the dynamic impact on hours worked over multiple time periods using a fully flexible difference-in-differences estimator.
Subjects: 
minimum wages
heterogeneous effects
flexible difference-in-difference
JEL: 
E24
J22
J23
J31
J42
Document Type: 
Working Paper

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