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Understanding the impacts of minimum wages in South Africa: Evidence using national corporate tax data

Research Project

Project/Area Number 23K01367
Research Category

Grant-in-Aid for Scientific Research (C)

Allocation TypeMulti-year Fund
Section一般
Review Section Basic Section 07040:Economic policy-related
Research InstitutionInstitute of Developing Economies, Japan External Trade Organization

Principal Investigator

伊藤 成朗  独立行政法人日本貿易振興機構アジア経済研究所, 開発研究センターミクロ経済分析研究グループ, 研究グループ長 (50450482)

Project Period (FY) 2023-04-01 – 2026-03-31
Project Status Granted (Fiscal Year 2023)
Budget Amount *help
¥4,680,000 (Direct Cost: ¥3,600,000、Indirect Cost: ¥1,080,000)
Fiscal Year 2025: ¥130,000 (Direct Cost: ¥100,000、Indirect Cost: ¥30,000)
Fiscal Year 2024: ¥1,950,000 (Direct Cost: ¥1,500,000、Indirect Cost: ¥450,000)
Fiscal Year 2023: ¥2,600,000 (Direct Cost: ¥2,000,000、Indirect Cost: ¥600,000)
Keywordsminimum wages / oligopsony / concentration measures / developing countries
Outline of Research at the Start

In South Africa, minimum wages may increase the already high unemployment rates. Using administrative data, we ask: 1. Do employment impacts of minimum wages change by labor market concentration? 2. Does the survival probability of marginal firms decrease in a highly concentrated labor market?

Outline of Annual Research Achievements

A standard theory suggests the disemployment impacts may be related to labour market oligopsony. While the idea is simple, its empirical implementation is not simple. The only paper implements this chooses an industry with an extensive franchise network with uniform jobs, with a plausible condition that the variations in degree of concentration is as good as random: Retail clerical jobs. It uses US data. A study with the same focus using a developing country data is nonexistent. There is only one study (with any focus) using MEE data from a developing country. I have confirmed this still holds as I pointed in the research proposal. I also started the data work using SARS data where I computed HHI of each municipality and attach this value to each firm. This was done with other funding.

Current Status of Research Progress
Current Status of Research Progress

2: Research has progressed on the whole more than it was originally planned.

Reason

1. Overview of the research. Having read the recent papers, I confirmed the novelty of this research project.
2. Start of data work. I computed Herfindahl Hirschman index using SARS data. This was implemented with other funding.
3. Rescheduling of PC procurement. I learned in Dec 2023 that it takes 2-3 months to procure a pc of my configuration. I postpone the procurement to Apr 2024.

Strategy for Future Research Activity

1. Start data work. Will start data work from June or July. Continue until Feb 2025.
2. Do a field visit in June or July.

Report

(1 results)
  • 2023 Research-status Report

URL: 

Published: 2023-04-13   Modified: 2024-12-25  

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