Estimating the Effects of the Minimum Wage Using the Introduction of Indexation

We examine the impacts of minimum wage on employment using minimum-wage hike induced by introduction indexation local to cost living. The revision Minimum Wage Act in 2007 Japan essentially required government set indexed living, with a five-year moratorium period. subsequently increased areas where living was high relative wage. Allowing for different trends labor-market outcomes across regions pre-treatment period, we find that raised wages low-wage workers, but reduced less-educated young men. A panel analysis based matched Labor Force Survey data indicates decreased job flows prime-age men and women.