 Relative Wages and the Youth Labour MarketPramod (Raja) Junankar and A. J. Neale Chapter 4 in From School to Unemployment?, 1987, pp 79-107 from Palgrave Macmillan Abstract: Abstract The dramatic rise of youth unemployment in recent years in most OECD countries has led to the introduction of various policies targetted at youths. Although there are competing explanations of this phenomenon (as of aggregate unemployment), the British government (in particular) has been seduced by the explanation that the growth in youth unemployment is due to a rise in the relative wages of youths. The Prime Minister stated in Parliament (Hansard 27 July 1981, Cols 835–6) ‘[b]ecause the wages of young people are often too high in relation to those of experienced adults, employers cannot afford to take them on’. The Department of Employment produced a research paper (Wells, 1983) allegedly providing econometric evidence for this view. The Times gave this favourable publicity, and entitled an article ‘Pay Cuts Would Create Jobs for Young People’ (20 December 1983). In this chapter we review some of the evidence on the relationship between relative wages and youth (un)-employment in Great Britain and then estimate a disequilibrium model of the youth labour market. Keywords: Labour Market; Labour Supply; Labour Demand; Aggregate Demand; Excess Demand (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-18942-7_4 Ordering information: This item can be ordered from DOI: 10.1007/978-1-349-18942-7_4 Access Statistics for this chapter More chapters in Palgrave Macmillan Books from Palgrave Macmillan |
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