Minimum wage as a social policy tool: The reality and problems
<b>Importance</b> The article focuses on socio-economic issues concerning the effect of a minimum wage. <br></br> <b>Objectives</b> The research examines theoretical and legislative aspects of setting up the wage floor in Russia, analyzes how it develops and correlates with the subsistence level nationally and regionally. I also outline recommendations for improving the minimum wage assessment methodology so to ensure social protection of working people. <br></br> <b>Methods</b> I apply theoretical and empirical methods of research, such as deduction, analysis, synthesis, ranking, grouping, comparison, correlation and regression. <br></br> <b>Results</b> I detect legislative and regulatory problems, inconsistency of real practices with social guarantees enshrined in the Constitution of the Russian Federation. I analyze developments in a minimum wage, subsistence level throughout several years and trace a frail link between the nominal subsistence level and Consumer Price Index. The article enlists regions with high standards of living and income below the subsistence level by federal district. <br></br> <b>Conclusions and Relevance</b> Pronounced in the Constitution of the Russian Federation, social guarantees are formalistic and ineffective. A minimum wage is inconsistent with the necessary level of remuneration so to satisfy the primary needs of population. In this respect, it is necessary to improve the minimum wage assessment mechanism. Foreign practices for setting a minimum wage may have a positive effect. The findings can be used by the legislature and executive authorities of the Russian Federation and its constituent entities for decision-making purposes.