A few studies use individual- or household-level data to examine the impact of higher
minimum wages across the household income distribution. The findings suggest that
higher minimum wages modestly reduce poverty rates.
• In Mexico, workers in the poorest households had the largest wage gains following
an increase in the minimum wage (reducing the poverty gap), but the wage gains
were not large enough to push most of these households above the poverty line
[5].
• In Colombia, workers earning the minimum wage were most likely to be in
households in the middle of the income distribution (see Figure 3); the poorest
households did not benefit from minimum wages [6].
• Likewise, in Brazil, higher minimum wages did not raise the incomes of households
in the bottom three deciles of the household income distribution [9].
This suggests that higher minimum wages in Colombia and Brazil did lead to moderate
declines in poverty overall but did not reduce poverty among the very poorest