Minimum wage effects on employment, unemployment, economic growth and welfare

• Project/Area Number: 26380343
• Research Category: Grant-in-Aid for Scientific Research (C)
• Allocation Type: Multi-year Fund
• Section: 一般
• Research Field: Economic policy
• Research Institution: Aichi Prefectural University (2018); Osaka University of Economics (2014-2017)
• Principal Investigator: Masao Yamaguchi 愛知県立大学, 外国語学部, 准教授 (50511002)
• Project Period (FY): 2014-04-01 – 2019-03-31
• Project Status: Completed (Fiscal Year 2018)
• Budget Amount: ¥4,550,000 (Direct Cost: ¥3,500,000、Indirect Cost: ¥1,050,000); Fiscal Year 2017: ¥1,170,000 (Direct Cost: ¥900,000、Indirect Cost: ¥270,000); Fiscal Year 2016: ¥1,170,000 (Direct Cost: ¥900,000、Indirect Cost: ¥270,000); Fiscal Year 2015: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000); Fiscal Year 2014: ¥1,300,000 (Direct Cost: ¥1,000,000、Indirect Cost: ¥300,000)
• Keywords: 政策効果 / デフレ / 消費 / 雇用 / 失業 / 最低賃金 / マクロモデル / 処置効果 / 自然実験 / 賃金 / 在職期間 / 離職 / 賃金分布

Outline of Final Research Achievements

The theoretical research argues how an increase in minimum wage affects employment, consumption, and social welfare with dynamic general equilibrium model without market frictions. The study demonstrates that a minimum wage hike reduces an actual unemployment rate and has positive effects on an employment rate under the demand-shortage economy whereas they do not under a non-demand shortage economy. The study also shows that optimal minimum wage which maximizes social welfare and minimizes an actual unemployment rate when the economy faces the demand-shortage initially. These findings imply that the minimum wage can be considered as one of the effective policy for overcoming deflation and stagnation although it increases the natural rate of unemployment.
The empirical research shows the increase in minimum wage from 2008 to 2010 in Japan has statistically insignificant positive effects on employment, but has statistically significant positive effects on hourly wage and total wage costs.

Academic Significance and Societal Importance of the Research Achievements

最低賃金の日本の実証研究は蓄積が少ない。本研究はわが国で初めて事業所を対象に、最低賃金政策の政策効果を分析し、飲食店事業所において雇用に負の影響を与えないことを示した。引き続き実証研究の蓄積は必要であるが、わが国の最低賃金の役割を考える上で、本研究の結果は重要であると考えられる。
また、本研究で示した動学的一般均衡モデルによる分析結果は、デフレマインドから抜けられない、長期停滞に直面する日本経済の処方箋として重要な意義を持つと考えられる。学術的には、最低賃金政策を動学的一般均衡モデルとして示したことは、先行研究にはない斬新さがあると考えられる。

Research Products

• [Journal Article] Stagnation and minimum wage: Optimal minimum wage (2017)
  • Author(s): Masao Yamaguchi
  • Journal Title: MPRA_paper Volume: 80359 Pages: 1-26
• [Journal Article] 最低賃金の引き上げが飲食店事業所の雇用にどう影響するのか (2017)
  • Author(s): 山口雅生
  • Journal Title: 『政策科学』 Volume: 24巻3号 Pages: 127-146
  • Acknowledgement Compliant
• [Presentation] Macroeconomics and minimum wage: Optimal minimum wage policy (2018)
  • Author(s): 山口 雅生
  • Organizer: ポスト・ケインズ派経済学研究会
  • Invited
• [Presentation] Minimum wage effects: Empirical evidence from Japan (2016)
  • Author(s): Masao Yamaguchi
  • Organizer: Hanyang University (HERI/College of Economics and Finance) & Osaka University of Economics (ISBR), The 13th HERI-ISBR Joint Symposium
  • Place of Presentation: Hanyang University in Seoul(韓国)
  • Year and Date: 2016-11-04
  • Int'l Joint Research / Invited
• [Presentation] Can a minimum wage hike decrease an unemployment rate? (2015)
  • Author(s): Masao Yamaguchi
  • Organizer: University of Exeter business school, Economic Seminars
  • Place of Presentation: University of Exeter business school, Exeter, UK
  • Year and Date: 2015-02-27