Thursday, April 13, 2006

Minimum Wages & Teenagers

David Neumark and William Wascher report on research on the effects of the minimum wage on teenagers. Here is the abstract:
"Minimum wages increase the probability that teenagers leave school to become employed or work more hours, and increase the probability that they leave school and become non-enrolled and non-employed. Minimum wages also increase the probability that lower-wage employed teenagers become non-enrolled and non-employed. This evidence suggests that (1) the competitive model of minimum wage effects is largely correct; and (2) that there are significant enrollment and employment effects associated with minimum wage changes that should be of concern to policy makers."

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