A simple data-dependent filtering method is proposed before applying the Bai–Ng method to estimate the number of common factors in the conventional approximate factor model. The asymptotic justification is provided and the finite-sample performance is examined.

This paper revisits the contentious link between the level of the minimum wage and wage inequality. This is done utilizing the differential rates of minimum wage increase experienced by two age groups (youth and adults) in New Zealand, over the period 1997 to 2007.