Minimum Wage Effects on Employment and School Enrollment /

Neumark, David.

Minimum Wage Effects on Employment and School Enrollment / David Neumark, William Wascher. - Cambridge, Mass. National Bureau of Economic Research 1994. - 1 online resource: illustrations (black and white); - NBER working paper series no. w4679 . - Working Paper Series (National Bureau of Economic Research) no. w4679. .

March 1994.

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.




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