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Do Higher Real Minimum Wages Lead to More High School Dropouts? Evidence from Maryland Across Races, 1993–2004
Author(s) -
Crofton Stephanie O.,
Anderson William L.,
Rawe Emily C.
Publication year - 2009
Publication title -
american journal of economics and sociology
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.199
H-Index - 38
eISSN - 1536-7150
pISSN - 0002-9246
DOI - 10.1111/j.1536-7150.2009.00632.x
Subject(s) - ethnic group , immigration , educational attainment , demographic economics , unemployment , demography , dropout (neural networks) , wage , economics , geography , labour economics , sociology , economic growth , archaeology , machine learning , anthropology , computer science
A bstract We explore whether higher levels of the real minimum wage have differing effects on high school dropout rates across students of various races and ethnicities (whites, African Americans, Hispanics, and Asians). Using a panel of data across Maryland counties and annual observations in 1993–2004, we found higher real minimum wages to be associated with higher dropout rates for Hispanic students, but not for other races and ethnicities. We used a variety of model specifications and explanatory variables, including real income, the unemployment rate, teen pregnancy rates, and educational attainment among adults. Several of our findings are broadly consistent with commonly reported sociological observations regarding how behavioral choices may be affected by different levels across races and ethnicities of cultural integration of recent immigrants, family cohesiveness, the value placed on education, small business ownership, and hourly (vs. salaried) employment.