Abstract

SANTILLAN HERNANDEZ, Alma Sofía  and  VARGAS SANCHEZ, Juan Roberto. Effect of minimum wage increase on labor income in Mexico, 2018-2023. Inv. Econ [online]. 2025, vol.84, n.332, pp.113-139.  Epub Oct 27, 2025. ISSN 0185-1667.  https://doi.org/10.22201/fe.01851667p.2025.332.89883.

Between 2018 and 2023 the minimum wage in Mexico increased differentially each year in real terms ranging between 5.15 and 16.24 percent. This research aims to identify the effects of these increases on the labor income of Mexican workers aged 18 to 65, using data from the National Survey of Occupation and Employment. Difference-in-differences models with panel data and fixed effects are used for the analysis. The results indicate that the minimum wage increases had a greater impact on lower-income groups, being more pronounced in hourly income than in monthly income. Increasing the minimum wage is one of the main ways to maintain the purchasing power of people with lower incomes.

Keywords : Monthly labor income; minimum wage; hourly labor income; differences-in-differences.

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