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  6. THE DETERMINANTS OF MINIMUM WAGE VIOLATION IN SOUTH AFRICA

THE DETERMINANTS OF MINIMUM WAGE VIOLATION IN SOUTH AFRICA

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Cornell_Dyson_wp1105.pdf (277.75 KB)
Permanent Link(s)
https://hdl.handle.net/1813/58003
Collections
Dyson School Working Papers
Author
Bhorat, Haroon
Kanbur, Ravi
Mayet, Natasha
Abstract

This paper investigates the determinants of non-compliance or violation of minimum wage legislation in South Africa, a country where violation is high, at just under 50 percent. The number of labour inspectors per capita is used as a proxy for enforcement, whilst non-compliance is measured using an index of violation that measures both the proportion of individuals violated, as well as the depth of violation of an individual. Due to the potential simultaneity between enforcement and compliance, the number of labour inspectors is instrumented by the number of non-inspectors. The results suggest that there are a variety of factors impacting on violation, including firm-level, sectoral and spatial characteristics. One of the key determinants of violation is found to be the local unemployment rate.

Description
WP 2011-05 January 2011
Date Issued
2011-01-01
Publisher
Charles H. Dyson School of Applied Economics and Management, Cornell University
Type
article

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