This paper investigates the role of minimum wages in determining school enrolment (educational investment) in Indonesia using the National Socioeconomic Survey (Susenas). It finds that minimum wage legislation has a negative and significant substitution eﬀect on educational investment. Individuals are more likely to drop out of senior secondary school as a result of a minimum wage legislation. Even though the response among low-income households is positive, this result may be generated by a fall in the probability of obtaining low-skilled employment, which oﬀset the substitution eﬀect.
Pritadrajati, Dyah Savitri
"DETERMINANTS OF SCHOOL ENROLMENT IN INDONESIA: THE ROLE OF MINIMUM WAGE,"
Bulletin of Monetary Economics and Banking: Vol. 24:
2, Article 3.
Available at: https://bulletin.bmeb-bi.org/bmeb/vol24/iss2/3