Wilcox-Gök, Virginia Louise
Ph.D. (Doctor of Philosophy)
Department of Economics
Minimum wage--Economic aspects--United States; School enrollment--Economic aspects--United States; Labor supply--Effect of education on--United States
The purpose of this dissertation is to examine the effects of minimum wages on school enrollment and employment in the United States. A traditional two-way fixed-effects approach may not fully control for unobserved spatial heterogeneity, which potentially explains conflicting results for the impacts of the minimum wage on school enrollment and employment. I develop two research designs that address the spatial heterogeneity issue by using county pairs and commuting zones (CZs). The identification strategy of the first essay is based on a simple idea: In a contiguous county pair with different minimum wages across a state border, school districts in a lower minimum wage county serve as counterfactuals for school districts in a higher minimum wage county. This study uses administrative data from the Common Core of Data and cross-state county pairs. The findings confirm that the traditional two-way fixed-effects model suffers a strong downward bias resulting from the presence of spatial heterogeneity in unobserved high school enrollment trends. Using a quasi-experimental design that accounts for unobserved local differences across 1,177 contiguous county pairs, I find little evidence that the minimum wage has an adverse effect on grades 9-12 public high school enrollment. In the second essay, I use individual data from the American Community Survey and commuting zones. I first confirm that the traditional two-way fixed-effects model yields a negative effect of the minimum wage on school enrollment for age 16-19 teenagers. However, using a new model that accounts for unobserved local differences across 741 commuting zones, I find that the minimum wage has no adverse school enrollment effect. The findings are robust to the restricted sample in cross-state CZs and the selection of different sample periods. In addition to school enrollment, I also examine part-time labor market outcomes and initial college enrollment. For teenagers who are enrolled in school and have part-time jobs, I find that higher minimum wages do not reduce their working hours, but increase their hourly wages. For teenagers who only complete high school, the results show that the minimum wage has no effect on their decisions to attend college. In the third essay, I use panel data from the Quarterly Workforce Indicators and cross-state CZs to identify the effects of the minimum wage on employment stocks and flows (hires and separations). I develop a border-discontinuity method that uses counties with lower minimum wages as counterfactuals for counties with higher minimum wages in a cross-state CZ. My quasi-experimental design that accounts for unobserved local differences in 137 cross-state CZs indicates that the minimum wage has more sizeable negative estimated effects on employment flows (hires and separations) than employment stocks for teen workers. Additionally, the design also indicates that employment stocks, hires and separations fall faster in short tenure jobs, among female workers, and among young workers in the accommodation and food service industry.
Pan, Zheng, "Essays in minimum wage, school enrollment and employment" (2016). Graduate Research Theses & Dissertations. 2908.
vii, 89 pages
Northern Illinois University
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