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A Model for Analyzing Youth Labor Market Policies

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  • Alan L. Gustman
  • Thomas L. Steinmeier

Abstract

This paper formulates a model of the youth labor market. At the heart of the model is a minimum wage restriction which causes some youths to become unemployed and prevents others from training. Labor is assumed to be heterogeneous in performance on skilled iobs and is less productive as youths than as adults simply because of immaturity. The model is applied to analyze the effects of three representative policies: a youth subminimum wage, subsidies paid to firms that hire youths, and training subsidies that offset the costs of on-the-job training.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 1621.

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Date of creation: Feb 1989
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Handle: RePEc:nbr:nberwo:1621

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  1. Daniel Hamermesh, 1971. "Economic Aspects of Manpower Training Programs," Working Papers 392, Princeton University, Department of Economics, Industrial Relations Section..
  2. Robert H. Meyer & David A. Wise, 1981. "Discontinuous Distributions and Missing Persons: The Minimum Wage and Unemployed Youth," NBER Working Papers 0711, National Bureau of Economic Research, Inc.
  3. Martin Feldstein & David T. Ellwood, 1982. "Teenage Unemployment: What is the Problem?," NBER Working Papers 0393, National Bureau of Economic Research, Inc.
  4. Venti, Steven F, 1984. "The Effects of Income Maintenance on Work, Schooling, and Non-Market Activities of Youth," The Review of Economics and Statistics, MIT Press, vol. 66(1), pages 16-25, February.
  5. William T. Dickens & Kevin Lang, 1985. "A Test of Dual Labor Market Theory," NBER Working Papers 1314, National Bureau of Economic Research, Inc.
  6. Edward M. Gramlich, 1976. "Impact of Minimum Wages on Other Wages, Employment, and Family Incomes," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 7(2), pages 409-462.
  7. David T. Ellwood, 1982. "Teenage Unemployment: Permanent Scars or Temporary Blemishes?," NBER Chapters, in: The Youth Labor Market Problem: Its Nature, Causes, and Consequences, pages 349-390 National Bureau of Economic Research, Inc.
  8. Richard B. Freeman & David A. Wise, 1982. "The Youth Labor Market Problem: Its Nature, Causes, and Consequences," NBER Books, National Bureau of Economic Research, Inc, number free82-1, October.
  9. Michael C. Barth, 1974. "Market effects of a wage subsidy," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 27(4), pages 572-585, July.
  10. Robert E. Hall, 1982. "The Minimum Wage and Job Turnover in Markets for Young Workers," NBER Chapters, in: The Youth Labor Market Problem: Its Nature, Causes, and Consequences, pages 475-498 National Bureau of Economic Research, Inc.
  11. Linda S. Leighton & Jacob Mincer, 1982. "Labor Turnover and Youth Unemployment," NBER Working Papers 0378, National Bureau of Economic Research, Inc.
  12. Linda Leighton & Jacob Mincer, 1982. "Labor Turnover and Youth Unemployment," NBER Chapters, in: The Youth Labor Market Problem: Its Nature, Causes, and Consequences, pages 235-276 National Bureau of Economic Research, Inc.
  13. Gustman, Alan L & Steinmeier, Thomas L, 1981. "The Impact of Wages and Unemployment on Youth Enrollment and Labor Supply," The Review of Economics and Statistics, MIT Press, vol. 63(4), pages 553-60, November.
  14. Carmichael, Lorne, 1983. "Does Rising Productivity Explain Seniority Rules for Layoffs?," American Economic Review, American Economic Association, vol. 73(5), pages 1127-31, December.
  15. Mincer, Jacob, 1976. "Unemployment Effects of Minimum Wages," Journal of Political Economy, University of Chicago Press, vol. 84(4), pages S87-104, August.
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