≡ Menu

Bonus Quotation of the Day…

… is the concluding paragraph of the excellent new Cato Journal article by economists J. Wilson Mixon and E. Frank Stephenson entitled “Young and Out of Work: An Analysis of Teenage Summer Employment, 1972-2012” (link added):

Vedder and Gallaway (1993: 294) concluded that inexperienced youths were among “the biggest losers from state intervention” in labor markets. Our results suggest that same conclusion may be reached about teen summer jobs over the past four decades. Even after controlling for the adverse effects on teen summer employment of increased labor force participation by senior workers, cyclical macroeconomic factors, and, for male teens, the decline in manufacturing employment, increases in the real value of the minimum wage are found to have detrimental effects on teen employment, particularly for black teens.

Note that increased labor-force participation by senior workers is not independent of hikes in the minimum wage: the higher the wage, the more likely are retirees and housewives to enter the labor force in search of paid employment (and, hence, to displace less experienced and less skilled young people).