data:national administrative panel survey British Household Panel Survey (BHPS)
design:observational
method:observational methods with counterfactual approach; Gini coefficient used for income inequality
sample:5500
unit:households
representativeness:subnational, rural
causal:1# 0 correlation / 1 causal
theory:
limitations:has to assume no effects on employment
observation:
- intervention:minimum wage
institutional:1
structural:0
agency:0
inequality:spatial; income
type:0# 0 vertical / 1 horizontal
indicator:1# 0 absolute / 1 relative
measures:income
findings:overall insignificant decrease of income inequality; policy will have spatial dimension with rural households more affected; larger positive impact for remote rural households
channels:rural component depends on proximity to urban areas through having access to urban markets
direction:1# -1 neg / 0 none / 1 pos
significance:0# 0 nsg / 1 msg / 2 sg
notes:
annotation:|
A study looking at the distributional effects of introducing a minimum wage in Britain, with a specific spatial component.
Overall it finds little effect on income inequality in the country.
It finds that the effects on rural areas differ depending on their proximity to urban areas.
While overall income inequality only decreases a small amount, the intervention results in effective targeting with remote rural households having around twice the reduction in inequality compared to others.
Rural areas that are accessible to urban markets are less affected, with insignificant impacts to overall income inequality reduction.
One limit of the study is that it has to assume no effects on employment after the enaction of the minimum wage for its results to hold.
