9:
Many books, journal articles and opinion pieces have been written about the youth unemployment issue, and it is certain that a great many more will be written in the future. Economists and other social scientists have done an adequate job in pointing out the causes and consequences of the problem, and they have often helped politicians, governmental officials and the business community with the design of policies and programs that try to address it. Yet as we have seen throughout these chapters, knowledge and data do not appear to be compelling enough reasons to motivate the implementation of actions that could dramatically reduce the youth unemployment rates in Southern Mediterranean countries. This, of course, begs the question of why the apparent disconnect, if the proposed interventions do not require a complete reorientation of a nation’s basic cultural values? Five hypotheses are offered, recognizing that they are not entirely mutually exclusive.
There are two policies, that is, minimum wages and government-subsidized, public sector jobs and job training, that not only fail to reduce unemployment but actually may contribute to its increase. Economic theory suggests that if you raise the price of any commodity, including labor, the demand will decrease. A recent high-profile experiment conducted in Seattle, Washington, provided an example of what usually occurs when the minimum wage is raised in a local labor market (Jardim et al, 2017). In 2015 the city raised its minimum wage from $9.47 an hour to $11.00. In 2016 the wage was raised again to $13.00.
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