Abstract
This paper reviews the literature that relates minimum wages in India to wage and employment outcomes. The entire empirical literature on the Indian minimum wage is not large, and the segment focused on wages and employment comprises only a few analyses. It reports that minimum wages result in higher wages. However, this occurs not near the bottom of the wage distribution, as would be expected from a wage floor, but near the middle of the distribution. This suggests a lighthouse effect; a minimum wage that is aspirational, acting as a benchmark to which various wages are compared, rather than a floor. The only statistically significant, negative effect on employment that is reported is for child labour. Other estimates are either not statistically significant or are positive.