Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/169139
Authors: 
Fidrmuc, Jan
Tena, Juan de Dios
Year of Publication: 
2017
Series/Report no.: 
Economics Discussion Papers 2017-80
Abstract: 
The UK national minimum wage (NMW) is age-specific with the most important threshold at the age of 22 (lowered to 21 from 2010 onwards) when workers become eligible for the adult rate. The authors estimate the impact of this threshold on employment by means of a regression discontinuity analysis. Because this threshold is known in advance, they investigate the presence of discontinuities in both the level and the slope of employment probabilities at different ages around the threshold. Their results indicate that turning 22 does not significantly change the employment probability. However, they find a significant change in the slope of the probability of being employed around one year before, suggesting a smooth deterioration of employment probability before turning 22 rather than a sudden change at a particular age. This finding is confirmed by a differencein- difference analysis. However, no such effect can be found during the period preceding the introduction of the NMW.
Subjects: 
Minimum wage
employment
young workers
regression discontinuity design
JEL: 
J21
J23
Creative Commons License: 
http://creativecommons.org/licenses/by/4.0/
Document Type: 
Working Paper
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