Driven from Work: Graduated Driver License Programs and Teen Labor Market Outcomes

Laura M. Argys, Thomas A. Mroz, and M. Melinda Pitts
Working Paper 2019-16
July 2019

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In response to a high incidence of motor vehicle accidents among teens, states have adopted policies that broadly mandate restrictions on novice teen drivers, including more prelicensure education and supervised driving as well as postlicensure curfews and restrictions on the number of passengers. By making it costlier to obtain a driver's license and reducing the benefits of a license by limiting driving hours and restricting passengers, graduated driver licensing (GDL) may also alter the cost of activities that are complementary to driving. This research explores the unintended consequences GDL laws may have on the labor/leisure tradeoff of teens, as it alters the return to market work and the benefit of leisure. The results suggest that approximately half of the decline in teen labor force participation since 1995 can be attributed to the restrictions associated with graduated driver licenses.

JEL classification: J22, I18, H7

Key words: graduated driver licensing, teen labor force participation, driving restriction

https://doi.org/10.29338/wp2019-16Off-site link


The authors thank Amanda Kay Seals, Astha Sen, Christopher McPherson, and Biplab Datta for research assistance. The authors are grateful for suggestions from seminar participants at the Southern Economic Association meetings, San Diego State University, Clemson University, and the Federal Reserve Bank of Atlanta. The views expressed here are those of the authors and not necessarily those of the Federal Reserve Bank of Atlanta or the Federal Reserve System. Any remaining errors are the authors' responsibility.

Please address questions regarding content to Laura M. Argys, Department of Economics, CB 181, University of Colorado Denver, P.O. Box 173364, Denver, CO 80217-3364, laura.argys@ucdenver.edu; Thomas A. Mroz, Georgia State University, Department of Economics, P.O. Box 3992, Atlanta, GA 30302-3992, tmroz@gsu.edu; or M. Melinda Pitts, Federal Reserve Bank of Atlanta, Research Department, 1000 Peachtree Street NE, Atlanta, GA 30309-4470, 404-498-7009, melinda.pitts@atl.frb.org.

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