NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Minimum Wage Effects on Employment and School Enrollment

David Neumark, William Wascher

NBER Working Paper No. 4679
Issued in March 1994
NBER Program(s):   LS

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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Document Object Identifier (DOI): 10.3386/w4679

Published:

  • Journal of Business and Economic Statistics, Vol. 13, no. 2 (April 1995), pp. 199-206 citation courtesy of
  • Published as "Is the Time-Series Evidence on Minimum Wage Effects Contaminated by Publication Bias?" Economic Inquiry, Vol. 36, no. 3 (July 1998), pp. 458-470.

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