Inter-regional project : How to strengthen social protection coverage in the context of the European Union Agenda on decent work and promoting employment in the informal economy. Thailand : Case Study

Thailand is a middle-income country with per capita income of 134,343 baht or US$3,887 in 2007.1 It was once an agrarian economy, but with the pace of development, its economy now relies more on industry and services. As a result, employment in these sectors has been increasing. With the move into a modern economy, labour standards have improved. The first half of the 1970s, was a period in which advances were made in social democracy. Workers demanded that their right to a decent job should be protected by law. A number of laws came into force in this period, for example, on labour relations, workmens compensation, private-school teaching staff and labour protection.social protection, European Union Agenda, informal economy, Employment

Minimum Wage: Does it Improve Welfare in Thailand?

We study the causal impact of the minimum wage on labor market outcomes, household consumption, inequality and poverty in Thailand by relying on policy variation in minimum wages over time across provinces. We find that minimum‐wage increases have a large and significant impact on the likelihood of working in the uncovered sector among workers with elementary education. However, the impact is very small and insignificant among other labor market groups. In contrast, the minimum wage has large positive effects on the formal sector wages of low‐earning workers, such as the young, elderly and low educated. Increases in the minimum wage are associated with reductions in household poverty and consumption inequality at the bottom half of the distribution.This research was sponsored by the World Bank under contract 7800772 and the Development Research Funds. Sanz‐de‐Galdeano gratefully acknowledges financial support from the Spanish Ministry of Economy and Competitiveness Grant ECO2014‐58434‐P