Minimum Wages and Child Health in Indonesia
AbstractEarly life environmental conditions play a critical role in well-being over the life-course. Most studies have treated extreme and less commonly observed shocks, such as famines, as natural experiments to study the causal impact of early life conditions. However, little attention is paid to the potential of labor market institutions, specifically income protection legislation, in shaping opportunities for investing in early life health and the subsequent impact on early life health outcomes.
We study minimum wages around the time of birth and their effects on child stunting in Indonesia up to 5 years after birth. Indonesia is interesting not only because it carries the fifth highest burden of stunted children in the world, but also because minimum wages are an integral part of their social policy debate where protests by workers are a regular occurrence.
To the extent that minimum wages influence parental wage income, they might affect parental investments in child health. For example, if wages were to increase, families might be more likely to avail themselves of health services and engage in other salutary behaviors which may be particularly effective around the time of birth. However, mothers may also be more likely to spend more time in the labor market at the expense of care-giving activities. The time around birth is widely understood to be critical period in shaping child nutrition and stunting levels, so that changes in parental economic conditions may have particularly large effects on child health and nutrition
Using variation in annual fluctuations in real minimum wages in different provinces of Indonesia, we find that children exposed to increases in minimum wages in the year of birth have higher height-for-age (HAZ) scores in the first five years of their lives.