The effects of minimum wages on teenage birth rates

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Abstract

This study adds to a recently growing number of studies evaluating non-employment effects of minimum wages. Using U.S. data between 1995 and 2017, a period with 380 state-level minimum wage increases, I estimate the effect on teenage birth rates (age 15-19). I find that a $1 increase in minimum wages is associated to a 2.8-3.4 percent decline in teenage birth rates, which corresponds to 1.1 to 1.3 fewer birth per 1,000 young women. My analysis shows that the effects are driven by states that also have state Earned Income Tax Credit (EITC) laws in place. Furthermore, I show that minimum wages are also associated with a 2.9 percent decline in birth rates among women aged 20 to 24, and with smaller but statistically significant declines in birth rates for women between the ages 25 to 39. These findings suggest that, rather than delaying childbearing age, minimum wage reduce overall birth rates.
Original languageEnglish
Article number109670
Number of pages19
JournalEconomics Letters
Volume198
Early online date25 Nov 2020
DOIs
Publication statusPublished - 31 Jan 2021

Keywords

  • minimum wage
  • teenage birth rate
  • earned income tax credit

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