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Minimum Wage Effects on Employment and School Enrollment

Author

Listed:
  • Neumark, David
  • Wascher, William

Abstract

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, the authors estimate a conditional logit model of employment and enrollment outcomes for teenagers using state-year observations for the period 1977 to 1989. The authors find a negative influence of minimum wages on school enrollment and a positive effect on the proportion of teens neither employed nor in school. The 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 & Wascher, William, 1995. "Minimum Wage Effects on Employment and School Enrollment," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(2), pages 199-206, April.
    • Handle: RePEc:bes:jnlbes:v:13:y:1995:i:2:p:199-206
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    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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