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A Model for Analyzing Youth Labor Market Policies

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  • Alan L. Gustman
  • Thomas L. Steinmeier

Abstract

This paper formulates a model of the youth labor market. At the heart of the model is a minimum wage restriction which causes some youths to become unemployed and prevents others from training. Labor is assumed to be heterogeneous in performance on skilled iobs and is less productive as youths than as adults simply because of immaturity. The model is applied to analyze the effects of three representative policies: a youth subminimum wage, subsidies paid to firms that hire youths, and training subsidies that offset the costs of on-the-job training.

Suggested Citation

  • Alan L. Gustman & Thomas L. Steinmeier, 1985. "A Model for Analyzing Youth Labor Market Policies," NBER Working Papers 1621, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:1621
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    References listed on IDEAS

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    2. Richard B. Freeman & David A. Wise, 1982. "The Youth Labor Market Problem: Its Nature, Causes, and Consequences," NBER Books, National Bureau of Economic Research, Inc, number free82-1.
    3. Gustman, Alan L & Steinmeier, Thomas L, 1981. "The Impact of Wages and Unemployment on Youth Enrollment and Labor Supply," The Review of Economics and Statistics, MIT Press, vol. 63(4), pages 553-560, November.
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    6. Meyer, Robert H & Wise, David A, 1983. "Discontinuous Distributions and Missing Persons: The Minimum Wage and Unemployed Youth," Econometrica, Econometric Society, vol. 51(6), pages 1677-1698, November.
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    11. Alan L. Gustman & Thomas L. Steinmeier, 1980. "Labor Markets and Evaluations of Vocational Training Programs in the Public High Schools - Toward a Framework for Analysis," NBER Working Papers 0478, National Bureau of Economic Research, Inc.
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    13. Dickens, William T & Lang, Kevin, 1985. "A Test of Dual Labor Market Theory," American Economic Review, American Economic Association, vol. 75(4), pages 792-805, September.
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    18. Venti, Steven F, 1984. "The Effects of Income Maintenance on Work, Schooling, and Non-Market Activities of Youth," The Review of Economics and Statistics, MIT Press, vol. 66(1), pages 16-25, February.
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