Absorption of Formal and Informal Sector Workers through the Minimum Wage: Studies in Indonesia
Absorption of Formal and Informal Sector Workers through the Minimum Wage: Studies in Indonesia
Author(s): . Ariani, Devanto Shasta Pratomo, Marlina Ekawaty, David KalugeSubject(s): Economy, Business Economy / Management, Socio-Economic Research
Published by: Институт за икономически изследвания при Българска академия на науките
Keywords: minimum wage; formal sector; informal sector
Summary/Abstract: This study aims to determine the effect of the minimum wage on employment in the formal and informal sectors in Indonesia. This study has a panel data set with a total of 170 observations consisting of 34 provinces in Indonesia during the 2017-2021 period. The use of the Ordinary Least Square (OLS) method, fixed effect, and random effect are used to compare the results of the three methods used. The results explain that the minimum wage has a negative and significant effect on the absorption of formal sector workers, while the minimum wage has a positive and significant effect on the absorption of informal sector workers.
Journal: Икономически изследвания
- Issue Year: 2024
- Issue No: 3
- Page Range: 128-143
- Page Count: 16
- Language: English