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Do Business Cycle Conditions at the Time of Labor Market Entry Affect Future Employment Prospects?

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  • Oddbjørn Raaum
  • Knut Røed

Abstract

Labor market conditions at the time and place of potential entry into the labor market are shown to have a substantial and persistent effect on adult employment prospects. Individuals who face particularly depressed local labor markets when they graduate from secondary education, are-other things equal-subject to relatively high rates of nonemployment during their whole prime-age work career. Building on a unique combination of micro and macro data from Norway, we show that these effects are robust with respect to model specification and conditioning variables, and that they are not limited to individuals with a particularly disadvantaged background. Copyright by the President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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Bibliographic Info

Article provided by MIT Press in its journal The Review of Economics and Statistics.

Volume (Year): 88 (2006)
Issue (Month): 2 (May)
Pages: 193-210

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Handle: RePEc:tpr:restat:v:88:y:2006:i:2:p:193-210

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Web page: http://mitpress.mit.edu/journals/

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Cited by:
  1. M. Gaini & A. Leduc & A. Vicard, 2012. "A scarred generation? French evidence on young people entering into a tough labour market," Documents de Travail de la DESE - Working Papers of the DESE g2012-05, Institut National de la Statistique et des Etudes Economiques, DESE.
  2. Erling Barth & Bernt Bratsberg & Oddbjørn Raaum, 2011. "Immigrant Wage Profiles Within and Between Establishments," Norface Discussion Paper Series 2011019, Norface Research Programme on Migration, Department of Economics, University College London.
  3. Jason M. Fletcher & Jody L. Sindelar, 2009. "Estimating Causal Effects of Early Occupational Choice on Later Health: Evidence Using the PSID," NBER Working Papers 15256, National Bureau of Economic Research, Inc.
  4. Beatrice Brunner & Andreas Kuhn, 2010. "The Impact of Labor Market Entry Condition on Initial Job Assignment, Human Capital Accumulation, and Wages," NRN working papers 2010-15, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
  5. Schmillen, Achim & Möller, Joachim, 2012. "Distribution and determinants of lifetime unemployment," Labour Economics, Elsevier, vol. 19(1), pages 33-47.
  6. Eriksson, Stefan & Rooth, Dan-Olof, 2011. "Do Employers Use Unemployment as a Sorting Criterion When Hiring? Evidence from a Field Experiment," IZA Discussion Papers 6235, Institute for the Study of Labor (IZA).
  7. Romain Duval & Mehmet Eris & Davide Furceri, 2011. "The Effects of Downturns on Labour Force Participation: Evidence and Causes," OECD Economics Department Working Papers 875, OECD Publishing.
  8. Beatrice Brunner & Andreas Kuhn, 2014. "The impact of labor market entry conditions on initial job assignment and wages," Journal of Population Economics, Springer, vol. 27(3), pages 705-738, July.
  9. Beatrice Brunner & Andreas Kuhn, 2009. "To shape the future: How labor market entry conditions affect individuals' long-run wage profiles," IEW - Working Papers 457, Institute for Empirical Research in Economics - University of Zurich.
  10. Brunner, Beatrice & Kuhn, Andreas, 2009. "To Shape the Future: How Labor Market Entry Conditions Affect Individuals' Long-Run Wage Profiles," IZA Discussion Papers 4601, Institute for the Study of Labor (IZA).
  11. Jason Fletcher, 2012. "The Effects of First Occupation on Long Term Health Status: Evidence from the Wisconsin Longitudinal Study," Journal of Labor Research, Springer, vol. 33(1), pages 49-75, March.
  12. Sylvia Frühwirth-Schnatter & Andrea Weber & Rudolf Winter-Ebmer, 2010. "Labor Market Entry and Earnings Dynamics: Bayesian Inference Using Mixtures-of-Experts Markov Chain Clustering," Economics working papers 2010-11, Department of Economics, Johannes Kepler University Linz, Austria.
  13. Beartice Brunner & Andreas Kuhn, 2009. "To Shape the Future: How Labor Market Entry Conditions Affect Individuals’s Long-Run Wage Profiles," NRN working papers 2009-29, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
  14. Haaland, Venke Furre, 2013. "The Lost Generation: Effects of Youth Labor Market Opportunities on Long-Term Labor Market Outcomes," UiS Working Papers in Economics and Finance 2013/8, University of Stavanger.
  15. Michael Boehm & Martin Watzinger, 2012. "The Allocation of Talent over the Business Cycle and its Effect on Sectoral Productivity," CEP Discussion Papers dp1143, Centre for Economic Performance, LSE.

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