The Economic Effect of Minimum Wage Policy: Theoretical Competition, Chinese Experience and Policy Coordination Path

DOI

10.2991/978-2-38476-553-9_37How to use a DOI?

Keywords

Minimum Wage; Economic Effect; Innovation Compensation; Regional Differentiation; Policy Coordination

Abstract

As the core tool for regulating the distribution of income in the labour market, the economic effect of the minimum wage policy has long been controversial in theory and practice. Based on the theoretical struggle between the neoclassical model and the buyer’s monopoly model, this study combines the actual background of the imbalance between China’s industrial structure transformation and regional development and adopts the research method of theoretical analysis and empirical experience comparison to systematically explore the heterogeneous impact of the minimum wage policy on employment, innovation and income distribution. Research results show that while raising the minimum wage stimulates technological innovation and automation substitution of enterprises (such as an increase in labour productivity by 7.5% in the Pearl River Delta), it may also lead to a decline in the participation rate of low-skilled youth labour (1.2 percentage points). Its effect is affected by the household registration system, regional industrial structure and platform algorithms. Significant adjustment of force. Based on this, this article proposes to take the “innovation compensation” mechanism as the core, and realise the coordinated improvement of efficiency and fairness through intelligent transformation subsidies, skill account systems and regional differentiation policies. This study not only provides theoretical support and practical path for the minimum wage policy with Chinese characteristics, but also has important reference value for global economies in transition.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Kaiyue Xu
PY  - 2026
DA  - 2026/03/25
TI  - The Economic Effect of Minimum Wage Policy: Theoretical Competition, Chinese Experience and Policy Coordination Path
BT  - Proceedings of the 2025 4th International Conference on Educational Science and Social Culture (ESSC 2025)
PB  - Atlantis Press
SP  - 318
EP  - 326
SN  - 2352-5398
UR  - https://doi.org/10.2991/978-2-38476-553-9_37
DO  - 10.2991/978-2-38476-553-9_37
ID  - Xu2026
ER  -