The effect of minimum wages on self-reported physical and mental health in China

Abstract

We exploit provincial variation in minimum wages allowed by the 2004 Chinese regulation to study the impact of minimum wages on the health of workers. We use data from Wave 1 of the World Health Organization's Study on Global Aging and Adult Health (SAGE) conducted in 2007–2010. We consider measures of self-reported health in ten domains and a measure of general health obtained from a factor analysis as dependent variables when estimating ordered probit models and linear models, respectively. We find that real minimum wages have a small, but not negligible, negative effect on most of the health outcomes and general health. The result is robust to several controls, including reporting heterogeneity. The negative effect on health is driven by the deterioration of working conditions, due to the increase in the number of days worked per week for public and private employees.