Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/282634 
Year of Publication: 
2023
Series/Report no.: 
IZA Discussion Papers No. 16507
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
This paper studies whether a minimum wage changes how labour markets respond to economic shocks. Using data from South Africa, we show that an agricultural minimum wage leads to higher mean wages with no significant impacts on mean employment. However, these positive aggregate outcomes hide important heterogeneity: the imposition of the minimumwage leads to substantial declines in employment - especially overall hours - in the sector in the wake of negative weather-related economic shocks, which typically exert downward pressure on wages. The increased variance of employment across years in the post-law period suggests caution in interpreting the overall welfare impacts of minimum wage laws.
Subjects: 
minimum wage
agriculture
shocks
weather
South Africa
JEL: 
J38
J43
O12
O13
Document Type: 
Working Paper

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