Dampak Upah Minimum terhadap Employment: Pendekatan Difference in Spatial Difference
Abstract
Most studies on the impact of minimum wages on employment resulted in a negative impact of minimum wages on employment in the formal sector. However, there are indications of bias because the results of these studies assume that the labor market between observation units are independent, whereas the labor market between observation units are dependent on each other. This study aims to estimate the impact of minimum wages on employment considering that between observation units are dependent on each other. Using a difference in spatial difference this study estimate the impact of minimum wages on employment using data Sakernas year 2010-2015 in Java. The estimation results a positive impact of the increase in the minimum wage on employment in the formal sector and negatif impact on employment in the informal sector. 100% increase in the real minimum wage is assosiate with approximately a 0.41%-0.47% increase in employment in the formal and decrease employment in informal sector approximately 0.22%-0.35%.
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References
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Dolton, P., Bondibene, C. R., & Stops, M. (2015). Identyfiying The Employmnet Effect of Invoking and Changing the Minimum Wage: A Spatial Analysis of The UK. Labor Economics, 54-76.
Dube, A., Lester, T. W., & Reich, M. (2010). Minimum Wage Effect Across State Borders: Estimates Ysing Contiguous Counties. The Review of Economics and Statistics, Vol. 92, No. 4, 945-964.
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Holmes, T. J. (1998). The Effect of State Policies on the Location of Manufacturing:
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Khamis, M. (2013). Does Minimum Wage Have a Higher Impact on The Informal Than On The Formal Labour Market? Evidence from quasi-experiments. Applied Economics, 477-495.
Lemos, S. (2009). Minimum Wage Effect in a Developing Country. Labour Economics, 224-237.
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Mincer, J. (Aug., 1976). Unemployment Effects of Minimum Wages. Journal of Political Economy, Vol. 84, No. 4, S87-S104.
Monras , J. (2015). Minimum Wages and Spatial Equilibrium: Theory and Evidence. IZA Discussion Paper No 9460.
Moretti, E. (2011). Local Labor Market, In: Ashenfelter, Orley, Edward Card, David (Eds), Handbook of Labor Economics. New York: Elsevier.
Nazara, S. (2010). Ekonomi Informal di Indonesia: UKuran, Komposisi, dan Evolusi. Jakarta: ILO.
Neumark, D., & Wiliiam, W. (1997). Do Minimum Wage Fight Poverty? NBER Working Paper Series No 6172.
Patacchini, E., & Zenou, Y. (2007). Spatial Dependence in Local Unemployment Rates. Journal of Economic Geography 7, 169-191.
Rama, M. (2001). Consequences of Doubling the Minimum Wage: The Case of Indonesia. Industrial and Labor Relations Review, Vol 54, No. 4, 864-881.
Wooldridge, J. (2013). Introductory Econometric: A Modern Approach, Fifth Edition. South Western: Cengage Learning.
www.pusdatin.naker.go.id
Alatas, V., & Cameron, L. A. (2008). The Impact of Minimum Wages in Employment in Low Income Country: a Quasi-natural Experiment in indonesia. Industrial and Labor Relation Review, Vo, 16, No 2, 201-
223.
Bhorat, H., Kanbur, R., & Mayet, N. (2013). The Impact of Sectoral Minimum Wage Laws on Employment, Wages, and Hours of Work in South Africa. IZA Journal Labor and Development 2:1.
Bird, K., & Manning, C. (2008). Minimum Wages and Poverty in a Developing Country: Simulations from Indonesia’s Household Survey. World Development Vol. 36, No. 5, 916–933.
Blau, F. D., & Kahn, L. M. (1999). Institutions and Laws in The Labour Market. In Handbook ofLabour Economic, Volume 3A (pp. 1399-1461). Amsterdam: Elsevier Science.
Borjas, G. J. (2013). Labor Economics Sixth Edition. New York: The McGraw-Hill Companies, Inc.
Burkhauser, R. V., Couch, K. A., & Wittenburg, D.
C. (2000). A Reassessment of the New Economics of the Minimum Wage Literature with MonthlyData from the Current Population Survey. Journal of Labor Economics, Vol. 18, No. 4 (October 2000), 653-680.
Cameron, A. C., Gelbach, J. B., & Miller, D. L. (2011). Robust Inference With Multiway Clustering. Journal of Business & Economic Statistics, 29:2, 238-249.
Comola, M., & De Mello, L. (2011). How Does Decentralized Minimum Wage Seting Affect Employment and Informality? The Case of Indonesia. The Review of Income and Wealth, Series 57.
Conley, T. G. (1999). GMM Estimation with Cross Sectional Dependence. Journal of Econometrics 92 (1), 1-45.
Conley, T. G., & Udry, C. R. (2010). Learning About a New Technology: Pineapple in Ghana. American Economic Review, Vol. 100, No. 1, 35-69.
Del Carpio, X., Nguyen, H., & Wang, L. C. (2012). Does The Minimum Wage Affect Employment? Evidence from Manufacturing Sector in Indonesia. World Bank Policy Reasearch working Paper 6147.
Dinkelman, T., & Ranchhod, V. (2012). Evidence On The Impact Of Minimum Wage Laws In An Informal Sector: Domestic Workers In South Africa. Journal of Development Economics 99 , 27-45.
Dolton, P., Bondibene, C. R., & Stops, M. (2015). Identyfiying The Employmnet Effect of Invoking and Changing the Minimum Wage: A Spatial Analysis of The UK. Labor Economics, 54-76.
Dube, A., Lester, T. W., & Reich, M. (2010). Minimum Wage Effect Across State Borders: Estimates Ysing Contiguous Counties. The Review of Economics and Statistics, Vol. 92, No. 4, 945-964.
Gindling, T., & Terrell, K. (2005). The Effect of Minimum Wages on Actual Wages in Formal and Informal Sector in Costa Rica. World Development Vol. 33 No. 11, 1905-
1921.
Gindling, T., & Terrell, K. (2007). The Effect of Multiple Minumum Wages Throughout The Labor Market: The Case of Costa Rica. Labour Economic 14, 485-511.
Gindling, T., & Terrell, K. (2010). Minimum Wahe Effect of Minimum Wages on the Employment and Earnings. Departement of Economics, American University Working Paper Series No 2005-04.
Hohberg, M., & Lay, J. (2015). The Impact of Minimum Wages on Informal and Formal Labor Market Outcomes: Evidence from Indonesia. IZA Journal of Labor and Development.
Holmes, T. J. (1998). The Effect of State Policies on the Location of Manufacturing:
Evidence from State Borders. Journal of Political Economy, Vol. 106, No. 4
(August 1998), 667-705.
Islam, I., & Nazara, S. (2000). Minimum Wage and The Welfare of Indonesian Worker, Occasional Discussion Paper Series No.3. Jakarta: ILO Jakarta.
Kalenkoski, C. M., & Lacombe, D. J. (2011). Minimum Wage and Teen Employment: A Spatial Panel Approach. IZA Discussion Paper No. 5933.
Khamis, M. (2013). Does Minimum Wage Have a Higher Impact on The Informal Than On The Formal Labour Market? Evidence from quasi-experiments. Applied Economics, 477-495.
Lemos, S. (2009). Minimum Wage Effect in a Developing Country. Labour Economics, 224-237.
Magruder, J. R. (2012). High Unemployment Yet Few Small Firm: The role of Centralized Bargaining in South Africa. America Economic Journal: Apllied Economics, Vol.4, No. 3, 138-166.
Magruder, J. R. (2013). Can Minimum Wages Cause a Big Push? Evidence from Indonesia. Journal of Development Economics, 48-62.
Maloney, W., & Mendez, J. (2004). Measuring The Impact of Minimum Waages. Evidence from Latin America. nber.
Mincer, J. (Aug., 1976). Unemployment Effects of Minimum Wages. Journal of Political Economy, Vol. 84, No. 4, S87-S104.
Monras , J. (2015). Minimum Wages and Spatial Equilibrium: Theory and Evidence. IZA Discussion Paper No 9460.
Moretti, E. (2011). Local Labor Market, In: Ashenfelter, Orley, Edward Card, David (Eds), Handbook of Labor Economics. New York: Elsevier.
Nazara, S. (2010). Ekonomi Informal di Indonesia: UKuran, Komposisi, dan Evolusi. Jakarta: ILO.
Neumark, D., & Wiliiam, W. (1997). Do Minimum Wage Fight Poverty? NBER Working Paper Series No 6172.
Patacchini, E., & Zenou, Y. (2007). Spatial Dependence in Local Unemployment Rates. Journal of Economic Geography 7, 169-191.
Rama, M. (2001). Consequences of Doubling the Minimum Wage: The Case of Indonesia. Industrial and Labor Relations Review, Vol 54, No. 4, 864-881.
Wooldridge, J. (2013). Introductory Econometric: A Modern Approach, Fifth Edition. South Western: Cengage Learning.
www.pusdatin.naker.go.id
Authors
Kurniawati, A. (2018) “Dampak Upah Minimum terhadap Employment: Pendekatan Difference in Spatial Difference”, Jurnal Ketenagakerjaan, 13(2). Available at: https://journals.kemnaker.go.id/index.php/naker/article/view/22 (Accessed: 15 October 2024).
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