Volume 17, Number 1 (Winter) 1982
Ehrenberg, Ronald G., and Alan J. Marcus. 1982. "Minimum Wages and Teenagers' Enrollment-Employment Outcomes: A Multinomial Logit Model." Journal of Human Resources 17(1):39-58.
This paper tests the hypothesis that the effect of minimum wage legislation on teenagers' education decisions is asymmetrical across family income classes, with the legislation inducing children from low-income families to reduce their levels of schooling and children from higher-income families to increase their educational attainment. We use data from the National Longitudinal Surveys (NLS) and exploit the fact that, although the minimum wage is fixed at a point in time, its value relative to adult wages varies across areas. Multinomial logit models of teenagers' enrollment-employment outcomes are estimated. The hypothesis appears to be confirmed for white teens; however, the evidence for nonwhites is more ambiguous.
The authors are, respectively, Professor of Economics and PhD candidate in
Labor Economics, Cornell University.
* Our research has been supported by NSF Grant SOC 77-15800. We are grateful to
our colleague, Bill Greene, for providing us with a copy of his computer program
that estimates the multinomial logit model. An earlier version of the paper was
presented at the December 1979 Econometric Society meetings.
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