Minimum Wage Policy : Lessons with a Focus on the ASEAN Region
This report consists of seven chapters and is divided into three parts. Part one focuses on the minimum wage policy, its historical evolution, and the current institutional context across ASEAN countries. Part two delves into the socio?economic impacts of the minimum wage policy on workers, households, firms, the economy, and the ASEAN region. Part III links the findings from each country to the ASEAN regional context and brings all the analysis together into a policy and operational discussion. Specifically, part one of the report includes this chapter (chapter one) and chapter two. The rest of chapter one summarizes the findings from all chapters in the report and presents an overview of lessons detailed in the final chapter. To provide some background and context for the remainder of the report, chapter two briefly describes the history of minimum wage policy around the world and the theoretical principles behind wage setting and its effects. Part two consists of four chapters. Chapter three, which describes how the minimum wage policy is structured and managed in each ASEAN country, includes details on the objectives that countries have set out for the policy and how the policy is enforced in each country. Chapter four summarizes results from primary and secondary empirical research on the impacts of minimum wage changes on employment, wages, and informal work in the four focus ASEAN countries. The discussion in this chapter takes into account the existence of complementary worker protection programs in each country. Chapter five discusses empirical results on whether changes in the minimum wage policy affect poverty and inequality. Since each country has distinct poverty programs, the discussion takes into account the presence of various social programs that potentially complement income earned from wage labor. Chapter six focuses on how wage and labor costs affect firms, especially in terms of investment decisions and productivity. Due to the limited availability of evidence on the impact of minimum wages on firm performance and private sector activity in ASEAN countries, a large part of the discussion in this chapter includes evidence from non-ASEAN countries. Lastly, this chapter reviews the status of the main labor market institutions legislated in the region and provides some evidence on how other labor institutions might interact with the minimum wage policy to shape its effect. Part three comprises chapter seven, which reflects on the material presented in previous chapters and provides policy?oriented insights. It discusses the political economy of the minimum wage policy and draws out the implications of having such diverse wage policies and institutional arrangements for wage management in an increasingly interlinked regional bloc such as ASEAN. The chapter also synthesizes the lessons learned throughout the report and frames the main labor policy issues to provide guidance for, and elicit action from, policymakers going forward.
| Summary: | This report consists of seven chapters
and is divided into three parts. Part one focuses on the
minimum wage policy, its historical evolution, and the
current institutional context across ASEAN countries. Part
two delves into the socio?economic impacts of the minimum
wage policy on workers, households, firms, the economy, and
the ASEAN region. Part III links the findings from each
country to the ASEAN regional context and brings all the
analysis together into a policy and operational discussion.
Specifically, part one of the report includes this chapter
(chapter one) and chapter two. The rest of chapter one
summarizes the findings from all chapters in the report and
presents an overview of lessons detailed in the final
chapter. To provide some background and context for the
remainder of the report, chapter two briefly describes the
history of minimum wage policy around the world and the
theoretical principles behind wage setting and its effects.
Part two consists of four chapters. Chapter three, which
describes how the minimum wage policy is structured and
managed in each ASEAN country, includes details on the
objectives that countries have set out for the policy and
how the policy is enforced in each country. Chapter four
summarizes results from primary and secondary empirical
research on the impacts of minimum wage changes on
employment, wages, and informal work in the four focus ASEAN
countries. The discussion in this chapter takes into account
the existence of complementary worker protection programs in
each country. Chapter five discusses empirical results on
whether changes in the minimum wage policy affect poverty
and inequality. Since each country has distinct poverty
programs, the discussion takes into account the presence of
various social programs that potentially complement income
earned from wage labor. Chapter six focuses on how wage and
labor costs affect firms, especially in terms of investment
decisions and productivity. Due to the limited availability
of evidence on the impact of minimum wages on firm
performance and private sector activity in ASEAN countries,
a large part of the discussion in this chapter includes
evidence from non-ASEAN countries. Lastly, this chapter
reviews the status of the main labor market institutions
legislated in the region and provides some evidence on how
other labor institutions might interact with the minimum
wage policy to shape its effect. Part three comprises
chapter seven, which reflects on the material presented in
previous chapters and provides policy?oriented insights. It
discusses the political economy of the minimum wage policy
and draws out the implications of having such diverse wage
policies and institutional arrangements for wage management
in an increasingly interlinked regional bloc such as ASEAN.
The chapter also synthesizes the lessons learned throughout
the report and frames the main labor policy issues to
provide guidance for, and elicit action from, policymakers
going forward. |
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