Is Minimum Wage an Effective Anti-Poverty Policy in Japan?

This paper considers whether minimum wage is a well-targeted anti-poverty policy by examining the backgrounds of minimum-wage workers, and whether raising the minimum wage reduces employment for unskilled workers. An examination of micro data from a large-scale government household survey, the Employment Structure Survey (Shugyo Kozo Kihon Chosa), reveals that about half of minimum-wage workers belong to households with annual incomes of more than 5 million yen as a non-head of household. A regression analysis indicates that an increase in the minimum wage moderately reduces the employment of male teenagers and middle-aged, married females, while it encourages the employment of high school age youth.