Economics of Legal Minimum Wage

552 Pages·1981·23.535 MB·English

by  Simon Rottenberg

The Economics of
Iægal Minimum Wages
A Conference Sponsored by the
American Enterprise Institute for Public Policy Research

The Economics of
Legal Minimum Wages
Edited by Simon Rottenberg
.1
American Enterprise Institute for Public Policy Research
Washington and london
Librory ol CoErc*s Crtrh8lng ln Pûlh.tlon lhls
Mâin entry under title:
The Economics of legal minimum wages.
(AEI symposia ; 81A)
Papers presented at a conference held at the
Amedcan Enterprise Institute, Washington, D.C.,
Nov. I and 2, 1979.
l.
Wages-Minimum u,age-United States--Congresses.
2. L,abor suppl5United States--4ongresses. 3. Human
L
capitat-Unired States-Congresses. Rottenb€rg,
II.
Simon. American Enterprise Institute for Public
III.
Policy Research. Series: Am€rican Enterpdse
Institute for Public Policy Research. AEI symposia;
81A.
HDI918.E26 331.2',3',@73
80-26563
ISBN 0-8447-2197-2
ISBN 0-8a47-2198-0 (pbk.)
AEI Symposia 8lA
@ 1981 by thc American Enterprise Institute for Public Policy Research,
Washington, D.C., and Lrndon. AII rights res€rved. No part of this
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the American Enterprise Institute for Public Policy Research.
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Cooldl ol Acdcdc Atÿbtca
Pntl W. Mccrackes, Chalman, Edmud Eta Day Unlversity Protessot ol Busi-
acss Admhlsrrution, U,,iveôity ol Mtchigan
Robcrt H. Bort, ,lr?rardcr M. Blckct Ptotcttor ol Public Law, Yole Law School
Kcnncth W. Dam, Harold l. oad Mation F. Grcea Prolessor o, Laÿ and Prcvost,
Unlÿe/,'ûy ol Chicago
DonÂld C. Hcllmaos, Protcssor ol Potiricot Sci,nce ond l emorlonat Studlct,
Aûive|§llt of Washlngtol
D. Galc rohnson, EttaHm llostings Moorc Diniaguished Servîcc Prdessor ol
Ecorûmics arrd Chaûmaû, Dewrûent ol Economics, U ÿe$iry of Chicago
Robcrt À Nisbct, ,{dfunct Schd?f, Ametical E .rùise l/,,triture
Hcrbcn $cin, A. Willit Robe son Prulessot ol Economics, Universiry ol Virginla
Iancs Q. Wilson,Ilezry I*e Shattuck Prolcssor oî Covanmeût, Hatvatd Uniÿcttiry
Cotdar
Dscaoüÿa
Ricbard B. Maddcn, Câaianat ol ,he Board Richard J. Farrcll
Willi8m r. Barcody, ,1., Presdeot Charles T. Fisher Itr
HcrmÀn ,- Schmidt Richard D. Wood
Edward S§lcc, Director ol
PubUcatlons
Ilo4rur lltrctorr Pstodhrb
Rus!€ll Chapin, f,cgirlaliÿe Anortscs AEl Economlt ,l{,tbeta Slain,
Editot
Robcrt B. Hclms, Ilcalth Polûcy Studics
AEI Forciga Policy and Delênse
ThoDrs F. ,ohnso& Economlc Policy studtc§
Rdÿiew, Robert ,. Prangcr,
Sidncy L. Joncs, §cminar Prcgruns Ediror,' Jamcs W. Abcllcra,
Marvin H. Kostcrs, Mawging Editot
Govùnmen Rcgutarion Srudlet Pl.ôlrc Opirio,r, Srymoür Manil
W. S. Moot., Izgal Pdicy Srulie§ Lipsct and Bcn ,. WatGrtbcrg,
ldt Co-Edirorr; Karlyn H. Kecne,
Rudolph G. Pcnner, Policy Stwlies Managlrrg Edlrot
Horvard R. Pcnniman/ wtin Ranncy,
n.gzlarrbr, Antonin Scalia,
Poliricql and Social P'occEset
Edüor,' Annc Brunsdale,
Robcrt I. PrâD8Er, ,rtqnorlonol Ptogroms Maruglng Edltot

Contents
List of Contributors xi
Introduction 1
Simon Rottenberg
PAPERS
The Effect of a Legal Minimum Wage on the Pay and Employ-
Nonstudents ll
ment of Teenage Students and
lames F. Ragan, lr,
The Effects of Federal Minimum Wages on the Industrial Dis-
Employment
tribution of Teenage 42
Robert F. Cottennan
The Impact of Minimum \ryages on Teenage Schooling and on
.........
the Part-Time/Full-Time Employment of Youths 61
l.
Peter Mauila
r
The Impact of Minimum ages on Youth Employment, Hours
of rüork, and School Attendance: Cross-sectionâl Evidence
Censuses
from the 1960 and 1970 88
Jwnes Cunningham
Some Determinants of the lævel and Racial Composition of
.... .....,... lU
Teenage Employment
Nabeel Al-Salam, Aline Quester, and Finis Welch
The Effects of Minimum Wages on Human Capital Formation 155
Linda Leighton and Jacob Mincer
Some Aspects of the Social Pathological Behavioral Effects of
.
Unemployment among Young People 174
Llad Phillips
The Impact of Minimum Wages on Private Household
Yÿorkers
.
Kenneth Gordon
What Have Minimum ly'ages Done in Agriculture?
Bruce Gardner
The Impact of Federal Mnimum Vÿage Laws on Employment of
Seasonal Cotton Farm Workers 233
lohn M. Trapani and J. R. Moroney
Minimum Wages and the Distribution of Economic Activity . . 247
Manhall R. Colberg
The Overtime Pay Provisions of the Fair Labor Standards Act 264
Rotuld G. Ehrenberg and Paul L. Schuttunn
Differential lægal Minimum lvages . .
Philip Couerill
........
acroeconomic Implications of the Minimum Wage 317
l. Husan McCulloch
Minimum Wages in Puerto Rico 327
Simon Rottenberg
The Impact of Minimum lVages on Industrial Employment in
Chile . . 3«)
Vifloio Cotbo
The Effects of Minimum Wage Regulation in France 357
Jean-lacques Rosa
Lægal Minimum Wagcs as an Instrument of Sociat Poticy in Less
Developed Countries, with Special Reference to Costa Rica
Peter Gregory
The Determinants of Minimum Wage lævels and C-overage in
State Minimum Wage l,aws 403
tanæs C. Cox and Ronald L. Oataca
Minimum Wages and Personal Income 429
Carolyn Shaw Bell
.
The [ow-Wage Sÿorkers: Who Are They? 459
l.
Thomas Kniesner
CoMMENTARY
r
\
An Overview of the Effect of Minimum ages on Employment
Opportunities
485
Sherwin Rosen
Emp§ment Aspects of the Fair Labor Standards Act: C-om-
.
ments on the Phillips and Ehrenberg-Schumann Essays . . . 491
Solomon William Polachek
Comments on the Substitution Effects of Minimum lVage
Lægislation
505
William Fellner
\Employment Effects and Determinants of Minimum Wage Laws:
Research
--'7 An Analysis of Current 510
Barry R. Chiswick
\
Comments on Differential Minimum Wages and Minimum age
.
Policies 515
Isaac Ehrlich
The Context of Recent Research 523
Robert S. Goldfarb
('
The Unanswered Question: Why Are Minimum Wages Popular
' with the Poor? 531
Keith B. Lefrlet