Mexico's minimum wage data: trends, policies, and a research agenda

The decline of the real value of the minimum wage amid trade liberalization in Mexico has raised concerns about its policy effectiveness and unintended consequences. The literature has examined the impact of minimum wage adjustments on employment levels, worker earnings, poverty, and inequality. However, findings from different sample periods and regions still need to be reconciled. It is necessary to understand the mechanisms connecting minimum wage to other market components. This research note first explores Mexico’s minimum wage data from 1980 to 2023 to grasp its spatial and temporal trends. We then discuss several future research directions to explore mechanisms through which minimum wage potentially works, including the welfare effect of the policy, the informal sector, and interactions between different policy tools.