Disentangling The Effects Of Large Minimum Wage And VAT Changes On Prices: Evidence From Mexico

Publicado en

• Labour Economics

Resumen

• In January 2019, in an effort to boost activity on the northern Mexican border, the authorities increased the minimum wage by 100 percent and decreased the value-added tax (VAT) by half. Disentangling both effects, we find increments in prices due to the minimum wage hike that were more than offset by the decreases associated with the VAT. In the absence of both policy changes, average prices would have been higher. The share of informal labor in the production of different goods seems to be playing a role in the impact of the minimum wage on prices.

autores

• Pérez Pérez, Jorge Eduardo
• Calderón Cerbón, Mariana
• Cortés Espada, Josué Fernando
• Salcedo, Alejandrina

fecha de publicación

• 2023

Área temática

• H20 - Tributación, subvenciones e ingresos: Generalidades
• J38 - Salarios, remuneraciones y costes laborales: Política pública
• J46 - Mercados de trabajo informales

Enfoque geográfico

• Mexico  Country
• South America  Continent

Líneas de investigación

• Minimum Wage
• Prices
• Value-Added Tax

Identificador de objeto digital (DOI)

• https://doi.org/10.1016/j.labeco.2022.102294

Volumen

• 80

Issue

• c