Economic Policy and Psychological Violence: The Hidden Costs of Spain's Minimum Wage Reform

Abstract

This paper examines the impact of a 22% minimum wage increase in Spain on January 2019 on intimate partner violence using a doubly robust difference-in-differences strategy with inverse probability weighting and the nationally representative Spanish Survey of Violence Against Women. We find no effect of the reform on physical or sexual violence. However, treated women—those with a high predicted probability of working at minimum wage jobs—experienced a 42% increase in psychological violence. Labor market analysis of survey respondents reveals that the reform led to a substitution away from female employment toward her partner’s employment, reducing women’s bargaining power within the household. For women whose partner is five years older, the increase in violence is not accompanied with lower female labor market engagement, providing evidence of alternative mechanisms, such as disrupted gender roles, or instrumental violence. These findings highlight unintended consequences of wage policy and highlight the need for complementary policies and services addressing the dangers of gender-based and domestic violence.