The Other Margin: Do Minimum Wages Cause Working Hours Adjustments for Low-Wage Workers?

This paper estimates the impact of the introduction of the UK minimum wage on the working hours of low-wage employees using difference-in-differences estimators. The estimates using the employer-based New Earnings Surveys indicate that the introduction of the minimum wage reduced the basic hours of low-wage workers by between one and two hours per week. The effects on total paid hours are similar (indicating negligible effects on paid overtime), and lagged effects dominate the smaller and less significant initial effects within this. Estimates using the employee-based Labour Force Surveys are typically less significant. Copyright (c) The London School of Economics and Political Science 2007.