The impact of minimum wages on population health: evidence from 24 OECD countries

• DOI: 10.1007/s10198-016-0847-5
• Publication Date: 2016-11-14T08:16:21Z
• Authors: Otto Lenhart
• Keywords: Population Health; Salaries and Fringe Benefits; 0502 economics and business; 05 social sciences; 8. Economic growth; Income; 1. No poverty; Humans; Organisation for Economic Co-Operation and Development; Poverty

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 have been shown to be more prevalent among individuals with low socioeconomic status (e.g., diabetes, disease of the circulatory system, stroke). A 10% 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.