The Correlation Between Minimum Wage and Youth Unemployment. A Cross Country Analysis
INTRODUCTION In this article , it mainly depicts about the correlation between minimum wage regulations and youth unemployment by examining data and sources from 25 different OECD countries in the year 2008. It consider youths between the ages from 15 and 24. The arcticle focuses on the hypothesis that as the minimum wage increases , youth unemployment will increase as well and as a result a positive correlation exists between the two variables. Since the minimum wages exixts as the price floor in the labour market , it skews the signals of demand and supply and thus produce a situation where there is surplus labour and thus it leads to more people willing to work at the minimum wage rate. And thus it is theretically said that , an increase in minimum wage would exacerbate this effect and increases unemployment. There are several reasons for focusing youth unemployment. Primarily , youth are among the most highly susceptible to minimum wage fluctuations as many...