The Impact of Minimum Wage Regulations on Educational Incentives for the Youth

Download or read book The Impact of Minimum Wage Regulations on Educational Incentives for the Youth written by Kim Leonie Kellermann and published by Springer. This book was released on 2016-12-27 with total page 155 pages. Available in PDF, EPUB and Kindle. Book excerpt: Kim Leonie Kellermann analyzes the impact of sectoral minimum wages in Germany on the willingness of youths to undergo apprenticeship training. Using data from the German Socio-economic Panel, the author shows that higher wage floors set small, positive incentives for vocational training in the respective sectors. In case employers have to pay higher wages, they preferably hire qualified workers so that the worse job prospects of the low-skilled outweigh the potential pay increase. In order to preserve these training opportunities, it can make sense for policymakers to exempt apprentices from minimum wages since subminimum apprenticeship rewards are more appealing to firms.