Low paid employment in Britain: estimating state-dependence and stepping stone effects
Cai, Lixin ; Mavromaras, Kostas G. ; Sloane, Peter J.
Institute of Labor Economics, Bonn
IZA - Bonn
2016
38 p.
low wages ; minimum wage ; self employment ; unemployment
Discussion Paper
9633
Wages and wage payment systems
English
Bibliogr.
"Using 18 waves of the British Household Panel Study, this paper examines state dependence and stepping stone effects of low pay. A distinguishing feature is that five types of transition- not in the labour force (NILF), unemployment, self-employment, low pay and higher pay are modelled separately. The results show that both state dependence and stepping stone effects of low pay are present. However, there is no evidence to support a low-pay no-pay cycle. The introduction of the national minimum wage does not appear to have affected state-dependence and stepping stone effects of low pay."
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