The effects of local employment opportunities on youths' work and schooling

This study uses individual-level data from the Sample Edited Detail File of the 1990 Decennial Census of the United States to estimate multinomial legit models of young men's and women's enrollment and employment behavior. The models include county-level averages of (1) the earnings opportunities currently available to individuals with similar educational backgrounds and (2) the difference in earnings opportunities associated with additional schooling as explanatory variables, Estimates indicate that young people who have not yet completed high school are relatively insensitive to changes in earnings opportunities. For young people who have completed high school, increases in current earnings opportunities modestly reduce enrollments and increase employment. (C) 2001 Elsevier Science Ltd. All rights reserved.