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IZA Journal of Labor & Development

Table 2 Aggregate index of violation, Area A

From: Partial minimum wage compliance

Year

v 0

v 1

v 2

v 1/v 0

2001

0.61

0.20

0.10

0.33

 

(0.026)

(0.014)

(0.008)

 

2002

0.66

0.22

0.10

0.34

 

(0.025)

(0.021)

(0.016)

 

2003

0.60

0.15

0.06

0.26

 

(0.023)

(0.010)

(0.006)

 

2004

0.64

0.17

0.07

0.27

 

(0.024)

(0.010)

(0.006)

 

2005

0.65

0.19

0.09

0.30

 

(0.028)

(0.017)

(0.009)

 

2006

0.63

0.18

0.08

0.29

 

(0.033)

(0.017)

(0.009)

 

2007

0.54

0.16

0.07

0.30

 

(0.034)

(0.0174)

(0.009)

 
  1. Standard errors in parenthesis. V0 is a headcount index which shows the percentage of farmworkers earning below the applicable minimum, V1 is the average distance of wages below the minimum, and V2 is the square of this gap which places more weight on observations furthest below the minimum. V1/V0 is a simple ratio but allows for an easy interpretation of V1 and can be read as: workers in year ‘x’ on average earn V1/V0 below the minimum
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