Minimum Wage Effects on Employment and School Enrollment

25 Pages Posted: 29 Dec 2000

See all articles by David Neumark

David Neumark

University of California, Irvine - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

William Wascher

Board of Governors of the Federal Reserve System

Date Written: March 1994

Abstract

We argue in this paper that the focus on employment effects in recent studies of minimum wages ignores an important interaction between schooling, employment, and the minimum wage. To study these linkages, we estimate a conditional logit model of employment and enrollment outcomes for teenagers using state-year observations for the period 1977 to 1989. The results show a negative influence of minimum wages on school enrollment and a positive effect on the proportion of teens neither employed nor in school. We further suggest that our results are consistent with substitution by employers of higher- for lower-skilled teenagers, with the displaced teens ending up both out of work and out of school.

Suggested Citation

Neumark, David and Wascher, William, Minimum Wage Effects on Employment and School Enrollment (March 1994). NBER Working Paper No. w4679, Available at SSRN: https://ssrn.com/abstract=254552

David Neumark (Contact Author)

University of California, Irvine - Department of Economics ( email )

3151 Social Science Plaza
Irvine, CA 92697-5100
United States
949-824-8496 (Phone)
949-824-2182 (Fax)

HOME PAGE: http://www.socsci.uci.edu/~dneumark/

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

William Wascher

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States
202-452-2812 (Phone)
202-452-3819 (Fax)

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
61
Abstract Views
1,643
rank
423,945
PlumX Metrics