A Cross-National Analysis of the Effects of Minimum Wages on Youth Employment

David Neumark and William Wascher

No 7299, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We estimate the employment effects of changes in national minimum wages using a pooled cross-section time-series data set comprising sixteen OECD countries for the period 1975-1997. We pay particular attention to the impact of cross-country differences in minimum wage systems and in other labor market institutions and policies that may either reduce or amplify the effects of minimum wages. Overall, our results generally are consistent with the view that minimum wages cause employment losses among youth. However, the evidence also suggests that the employment effects of minimum wages vary considerably across countries. Disemployment effects of minimum wages appear to be smaller when there are subminimum wages for youths, while, in the longer run at least, minimum wages set by collective bargaining may entail more deleterious employment effects. We also find that government policies restricting employers' ability to adjust nonpecuniary characteristics of jobs (such as hours restrictions or work rules) tend to exacerbate the negative effects of minimum wages on youth employment, while countries with active labor market policies designed to bring non-employed individuals into the work force tend to exhibit smaller disemployment effects from minimum wages.

JEL-codes: J23 J38 (search for similar items in EconPapers)
Date: 1999-08
New Economics Papers: this item is included in nep-cdm, nep-ltv, nep-pbe and nep-pub
Note: LS CH
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (18)

Published as Neumark, David and William Wascher. "Minimum Wages, Labor Market Institutions, And Youth Employment: A Cross-National Analysis," Industrial and Labor Relations Review, 2004, v57(2,Jan), 223-248.

Downloads: (external link)
http://www.nber.org/papers/w7299.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:7299

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w7299

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().