The Impact of Minimum Wages on Population Health: Evidence from 24 OECD Countries

The European Journal of Health Economics, DOI:10.1007/s10198-016-0847-5, Forthcoming

20 Pages Posted: 28 Apr 2017

See all articles by Otto Lenhart

Otto Lenhart

University of Strathclyde - Strathclyde Business School

Date Written: November 9, 2016

Abstract

This study examines the relationship between minimum wages and several measures of population health by analyzing data from 24 OECD countries for a time period of 31 years. Specifically, I test for health effects as a result of within-country variations in the generosity of minimum wages, which are measured by the Kaitz index. The paper finds that higher levels of minimum wages are associated with significant reductions of overall mortality rates as well as in the number of deaths due to outcomes that are have been shown to be more prevalent among individuals with low socioeconomic status (e.g. diabetes, disease of the circulatory system, stroke). A 10 percentage point increase of the Kaitz index is associated with significant declines in death rates and an increase in life expectancy of 0.44 years. Furthermore, I provide evidence for potential channels through which minimum wages impact population health by showing that more generous minimum wages impact outcomes such as poverty, the share of the population with unmet medical needs, the number of doctor consultations, tobacco consumption, calorie intake and the likelihood of people being overweight.

Keywords: Minimum Wage, Health, Mechanisms, OECD

JEL Classification: I10, I12, J38

Suggested Citation

Lenhart, Otto, The Impact of Minimum Wages on Population Health: Evidence from 24 OECD Countries (November 9, 2016). The European Journal of Health Economics, DOI:10.1007/s10198-016-0847-5, Forthcoming , Available at SSRN: https://ssrn.com/abstract=2959590

Otto Lenhart (Contact Author)

University of Strathclyde - Strathclyde Business School ( email )

100 Cathedral Street
Glasgow G1 1XU
United Kingdom

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