National minimum wage and employment of young workers in the UK
AbstractWe analyze the impact of the UK national minimum wage (NMW) on the employment of young workers. The previous literature found little evidence of an adverse impact of the NMW on the UK labor market. We focus on the age-related increases in the NMW at 18 and 22 years of age. Using regression discontinuity design, we fail to find any effect of turning 22. However, we find a significant and negative employment effect for male workers at 21, which we believe to be an anticipation effect. We also find a negative effect for both genders upon turning 18. The age-related NMW increases may have an adverse effect on employment of young workers, with this effect possibly occurring already well in advance of reaching the threshold age.
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Bibliographic InfoPaper provided by Central European Labour Studies Institute (CELSI) in its series Discussion Papers with number 12.
Date of creation: 18 Jun 2013
Date of revision:
minimum wage; employment; young workers; regression discontinuity design;
Other versions of this item:
- Jan Fidrmuc & J. D. Tena, 2013. "National Minimum Wage and Employment of Young Workers in the UK," CESifo Working Paper Series 4286, CESifo Group Munich.
- J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-06-24 (All new papers)
- NEP-EUR-2013-06-24 (Microeconomic European Issues)
- NEP-LAB-2013-06-24 (Labour Economics)
- NEP-LMA-2013-06-24 (Labor Markets - Supply, Demand, & Wages)
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