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

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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.ContentsEvidence of Minimum Wage Effects on EducationGenerally Binding Sectoral Minimum WagesThe New Country-Wide Minimum WageTarget GroupsResearchers and students in the fields of economic science and political economyExecutives and politicians in these areasThe AuthorKim Leonie Kellermann graduated from University of Münster with a Master of Science in Economics and works as a research assistant at the Chair of Political Economy of Prof. Dr. Thomas Apolte. Her PhD project focusses on the influence of labor market status on political participation and party preferences in democratic systems.