Hong Kong's Impending Natural Experiment: An Opportunity for Labor Economists

Bryan Caplan

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Another nail in the coffin of Hong Kong's exceptionalism: Its first minimum wage law passed.

Hong Kong's Legislative Council passed the Minimum Wage Bill on Saturday after a debate that lasted 41 hours. The law is set to take effect early next year.
The bill gives the framework for a minimum wage and does not stipulate actual wage. A committee appointed by the government will recommend the minimum wage. The committee will give its first recommendation by August to Chief Executive Donald Tsang.
Trade unions have proposed a minimum wage of HK$33 per hour. The minimum wage will be reviewed every two years, instead of the annual review demanded by unions.

But Hong Kong's loss can be your gain. If you want a natural experiment on the effect of the minimum wage on employment and beyond, now's your chance. Email Simon Lee of Hong Kong's Lion Rock Institute for more details.

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CATEGORIES: Labor Market
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COMMENTS (4 to date)

Latest Comment

John Thacker writes:

But surely all the ex-pats came to Hong Kong because they prefer life there to life at home. It shouldn't have taken a marketing genius to win them over to the cause of Hong Kong liberty.

Posted July 20, 2010 2:18 PM

Scott Sumner writes:

If I'm not mistaken many of the more social democratic countries in Northern Europe lack any national minimum wage. They often have negotiated minimum wages for specific sectors, but many workers are in sectors that lack any minimum wage.

Is HK now more socialist than Sweden?

More evidence that neoliberalism is tied to liberal cultural values?

Posted July 20, 2010 3:17 PM

Tom VanAntwerp writes:

I've been living in HK for about 7 months now, and I've found it to hardly the be free market paradise that many libertarians think it is. This new law is hardly the end of laissez-faire in Hong Kong compared to the long-standing government involvement in land use and housing.

Posted July 20, 2010 11:11 PM

guthrie writes:

But isn't Bryan suggesting that this is an opportunity for us to actually measure, in real time, the differences in their economy based on this one factor?

Posted July 21, 2010 9:49 AM

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