Research on Regional Differences of Influencing Factors of Minimum Wage ‐ ‐Based on Factor Analysis and LASSO Regression

Abstract

The influencing factors of the minimum wage play an important role in the formulation of the minimum wage, and the minimum wage has a great impact on people's livelihood. Based on the data from 2001 to 2020, this paper uses factor analysis and LASSO regression to explore the influencing factors of minimum wage in Zhejiang Province, Shanxi Province, Guizhou Province and Qinghai-Tibet Province, and analyzes the reasons for the difference of minimum wage in different regions. The results show that Zhejiang Province has the largest influence factor of minimum wage, followed by economic development level and residents' living consumption level; Shanxi Province is residents' living consumption level; Guizhou Province is residents' living consumption level and spiritual and cultural level; Qinghai-Tibet Province accounts for the largest proportion of residents' living consumption level, followed by economic development level and spiritual and cultural consumption level. The influencing factors of minimum wage are also different in different regions, and the minimum wage standard should be reasonably formulated according to the local influencing factors.