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Can Wage Subsidies Boost Employment in the Wake of an Economic Crisis?: Evidence from Mexico

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dc.contributor.authorBruhn, Miriam
dc.date.accessioned2016-04-26T16:30:04Z
dc.date.available2016-04-26T16:30:04Z
dc.date.issued2016-03
dc.description.abstractThe rise in unemployment during an economic crisis poses a significant concern to policy makers. This paper measures the effect of a program in Mexico that granted firms in certain industries wage subsidies if they decided to keep their workers instead of letting them go during the recent economic crisis. The analysis uses monthly administrative data on employment at the industry level, along with propensity score matching to construct groups of eligible and ineligible durable goods manufacturing industries that display statistically identical pre-program trends in employment. Difference-in-difference results show a positive but not statistically significant effect of the wage subsidies on employment during the program’s eight-month duration, ranging from 5.7 to 13.2 percent in magnitude, depending on the specification. The size of the effect increases to 24 percent after the program ended and the results indicate that employment after the program recovered faster in eligible industries than in ineligible industries.en
dc.identifierhttp://documents.worldbank.org/curated/en/2016/03/26085106/can-wage-subsidies-boost-employment-wake-economic-crisis-evidence-mexico
dc.identifier.doi10.1596/1813-9450-7607
dc.identifier.urihttps://hdl.handle.net/10986/24149
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper;No. 7607
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectFIRING RESTRICTIONS
dc.subjectJOBS
dc.subjectPRODUCING GOODS
dc.subjectUNEMPLOYMENT
dc.subjectEMPLOYMENT
dc.subjectLABOR MARKET
dc.subjectTRAINING COSTS
dc.subjectWORKERS
dc.subjectWAGE‐SUBSIDY
dc.subjectSEVERANCE PAYMENTS
dc.subjectLABOR MARKET PROGRAMS
dc.subjectWAGES
dc.subjectWAGE SUBSIDY
dc.subjectSKILLED WORKERS
dc.subjectMINIMUM WAGE
dc.subjectACTIVE LABOR MARKET PROGRAMS
dc.subjectWAGE SUBSIDIES
dc.subjectTRAINING COSTS
dc.subjectJOB TENURE
dc.subjectLABOR FORCE
dc.subjectPROBIT REGRESSION
dc.subjectWORK SCHEDULE
dc.subjectUNEMPLOYED WORKERS
dc.subjectJOB
dc.subjectFIRING RESTRICTIONS
dc.subjectRISING UNEMPLOYMENT
dc.subjectLABOR STATISTICS
dc.subjectPRIVATE SECTOR
dc.subjectMINIMUM WAGES
dc.subjectDISPLACEMENT EFFECT
dc.subjectWAGE SUBSIDY PROGRAM
dc.subjectLABOR MARKET POLICIES
dc.subjectEMPLOYMENT TRENDS
dc.subjectRISING UNEMPLOYMENT
dc.subjectACTIVE LABOR
dc.subjectWAGE SUBSIDY PROGRAM
dc.subjectWAGE‐SUBSIDY PROGRAM
dc.subjectEMPLOYMENT LEVELS
dc.subjectMANUFACTURING INDUSTRIES
dc.subjectLABOR MARKET
dc.subjectLABOR MARKET POLICIES
dc.subjectEMPLOYMENT LEVELS
dc.subjectUNEMPLOYED WORKERS
dc.subjectEMPLOYMENT SUBSIDIES
dc.subjectDISPLACEMENT EFFECTS
dc.subjectCREATING JOBS
dc.subjectDISPLACEMENT
dc.subjectWORKER
dc.subjectEMPLOYEE
dc.subjectACTIVE LABOR MARKET
dc.subjectMANUFACTURING INDUSTRY
dc.subjectCOLLEGE GRADUATES
dc.subjectUNEMPLOYED
dc.subjectJOB LOSS
dc.subjectWAGE SUBSIDIES
dc.subjectINFORMAL EMPLOYMENT
dc.subjectMEDICAL CARE
dc.subjectLABOUR
dc.subjectEMPLOYMENT RETENTION
dc.subjectLABOR
dc.subjectDISADVANTAGED WORKERS
dc.subjectDISADVANTAGED WORKERS
dc.subjectTOTAL EMPLOYMENT
dc.subjectEMPLOYMENT PROSPECTS
dc.subjectWAGE SUBSIDY
dc.subjectEMPLOYMENT PROSPECTS
dc.subjectWAGE EMPLOYMENT SUBSIDIES
dc.subjectINDUSTRIES
dc.subjectWAGE EMPLOYMENT
dc.subjectMINIMUM WAGES
dc.subjectMANUFACTURING INDUSTRIES
dc.subjectEMPLOYEES
dc.titleCan Wage Subsidies Boost Employment in the Wake of an Economic Crisis?en
dc.title.subtitleEvidence from Mexicoen
dc.typeWorking Paperen
dc.typeDocument de travailfr
dc.typeDocumento de trabajoes
dspace.entity.typePublication
okr.associatedcontenthttps://openknowledge.worldbank.org/handle/10986/34409 Journal article version
okr.crossref.titleCan Wage Subsidies Boost Employment in the Wake of an Economic Crisis? Evidence from Mexico
okr.date.disclosure2016-03-17
okr.date.doiregistration2025-04-07T08:14:47.883368Z
okr.date.doiregistration2025-04-08T16:06:31.960585Z
okr.date.doiregistration2025-04-09T02:47:13.752137Z
okr.doctypePublications & Research
okr.doctypePublications & Research::Policy Research Working Paper
okr.docurlhttp://documents.worldbank.org/curated/en/2016/03/26085106/can-wage-subsidies-boost-employment-wake-economic-crisis-evidence-mexico
okr.guid102451468184792317
okr.identifier.doi10.1596/1813-9450-7607
okr.identifier.externaldocumentum090224b08420ddd4_1_0
okr.identifier.internaldocumentum26085106
okr.identifier.reportWPS7607
okr.importedtrue
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2016/03/17/090224b08420ddd4/1_0/Rendered/PDF/Can0wage0subsi0evidence0from0Mexico.pdfen
okr.region.administrativeLatin America & Caribbean
okr.region.countryMexico
okr.topicSocial Protections and Labor::Wages, Compensation & Benefits
okr.topicMacroeconomics and Economic Growth::Economic Conditions and Volatility
okr.topicSocial Protections and Labor::Labor Markets
okr.topicMacroeconomics and Economic Growth::Taxation & Subsidies
okr.unitFinance and Private Sector Development Team, Development Research Group
relation.isAuthorOfPublication471c8982-45ac-42cd-87d0-3e505bd1a972
relation.isAuthorOfPublication.latestForDiscovery471c8982-45ac-42cd-87d0-3e505bd1a972
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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