DP7882 Minimum Wages and Earnings Inequality in Urban Mexico

Author(s): Mariano Bosch, Marco Manacorda
Publication Date: June 2010
Keyword(s): Mexico, Minimum Wage, Wage Inequality
JEL(s): J31, J38, O15, O17, O24
Programme Areas: Labour Economics, Public Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=7882

This paper analyzes the contribution of the minimum wage to the well documented rise in earnings inequality in Mexico between the late 1980s and the early 2000s. We find that a substantial part of the growth in inequality, and essentially all the growth in inequality in the bottom end, is due to the steep decline in the real value of the minimum wage.