effect of minimum wage for labor work in Brazil: 2002-2007

Abstract

This article investigates the contribution of the minimum wage to the process of income deconcentration during the period of 2002-2008. The micro data come from the National Household Survey (Pesquisa Nacional por Amostra de Domicílios – PNAD) of the Brazilian Institute of Geography and Statistics (Instituto Brasileiro de Geografia e Estatística – IBGE). The simulation method used is an adaptation of the method proposed in DiNardo, Fontin and Lemieux (1996), based on counterfactual Kernel density estimation. The results indicate that the relative contribution of the minimum wage reaches reasonable levels in the direct and inverse decomposition of the inequality indicators and contributes to deconcentration during the period studied. Furthermore, the minimum wage contribution to deconcentration is more intense among women.