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Education and Unemployment: State Dependence in Unemployment Among Young People in the 1990s

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Author Info
Kari Hämäläinen
Abstract

This study examines the labour market careers of young people who finished their studies or left compulsory schooling in 1988. The main issue of interest is the impact of past unemployment on current unemployment. The results strongly suggest a sizeable scarring effect of the incidence of unemployment on future labour market possibilities. The impact is estimated of being some 20 percentage points, on average, in terms of unemployment probability. When differentiated by the level of education, the results show that only university graduates were relatively immune to the damaging long-term effects of unemployment.

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Paper provided by Government Institute for Economic Research Finland (VATT) in its series Discussion Papers with number 312.

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Date of creation: 21 Aug 2003
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Handle: RePEc:fer:dpaper:312

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Related research
Keywords: Youth labour markets; state dependence; unemployment; panel data;

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Find related papers by JEL classification:
C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - General
J64 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment: Models, Duration, Incidence, and Job Search
J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
J40 - Labor and Demographic Economics - - Particular Labor Markets - - - General

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Sattinger, Michael, 1998. "Statistical Discrimination with Employment Criteria," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 39(1), pages 205-37, February.
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  2. Pekkala, Sari & Tervo, Hannu, 2002. " Unemployment and Migration: Does Moving Help?," Scandinavian Journal of Economics, Blackwell Publishing, vol. 104(4), pages 621-39, December. [Downloadable!] (restricted)
    Other versions:
  3. Gibbons, Robert & Katz, Lawrence F, 1991. "Layoffs and Lemons," Journal of Labor Economics, University of Chicago Press, vol. 9(4), pages 351-80, October. [Downloadable!] (restricted)
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  4. Blanchard, Olivier Jean & Diamond, Peter A, 1994. "Ranking, Unemployment Duration, and Wages," Review of Economic Studies, Blackwell Publishing, vol. 61(3), pages 417-34, July. [Downloadable!] (restricted)
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  5. Light, Audrey & Ureta, Manuelita, 1995. "Early-Career Work Experience and Gender Wage Differentials," Journal of Labor Economics, University of Chicago Press, vol. 13(1), pages 121-54, January. [Downloadable!] (restricted)
  6. Wiji Arulampalam & Alison L. Booth, 2000. "Union status of young men in Britain: a decade of change," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 15(3), pages 289-310. [Downloadable!]
  7. Butler, J S & Moffitt, Robert, 1982. "A Computationally Efficient Quadrature Procedure for the One-Factor Multinomial Probit Model," Econometrica, Econometric Society, vol. 50(3), pages 761-64, May. [Downloadable!] (restricted)
  8. Chamberlain, Gary, 1984. "Panel data," Handbook of Econometrics, in: Z. Griliches† & M. D. Intriligator (ed.), Handbook of Econometrics, edition 1, volume 2, chapter 22, pages 1247-1318 Elsevier. [Downloadable!] (restricted)
  9. Arulampalam, Wiji & Booth, Alison L & Taylor, Mark P, 2000. "Unemployment Persistence," Oxford Economic Papers, Oxford University Press, vol. 52(1), pages 24-50, January.
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  10. Blanchflower, David G. & Freeman, Richard B., 1996. "Growing Into Work," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich.
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  11. Christopher J. Ruhm, 1998. "The Economic Consequences Of Parental Leave Mandates: Lessons From Europe," The Quarterly Journal of Economics, MIT Press, vol. 113(1), pages 285-317, February. [Downloadable!] (restricted)
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  12. Waldfogel, Jane, 1998. "The Family Gap for Young Women in the United States and Britain: Can Maternity Leave Make a Difference?," Journal of Labor Economics, University of Chicago Press, vol. 16(3), pages 505-45, July. [Downloadable!] (restricted)
  13. Tomi Kyyrä, 1999. "Post-Unemployment Wages and Economic Incentives to Exit from Unemployment," Research Reports 56, Government Institute for Economic Research Finland (VATT). [Downloadable!]
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Jaakko Kiander, 2004. "Growth and Employment in Nordic Welfare States in the 1990s: a Tale of Crisis and Revival," Discussion Papers 336, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  2. Adriaan Perrels, 2004. "The Basic Service Quality Level of Transport Infrastructure in Peripheral Areas," Discussion Papers 335, Government Institute for Economic Research Finland (VATT). [Downloadable!]
    Other versions:
  3. Jaakko Kiander, 2004. "The Evolution of the Finnish Model in the 1990s: from Depression to High-tech Boom," Discussion Papers 344, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  4. Pekka Sinko, 2004. "Progressive Taxation Under Centralised Wage Setting," Discussion Papers 349, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  5. Erkki Koskela & Matti Virén, 2004. "Government Size and Output Volatility: New International Evidence," Discussion Papers 339, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  6. Pekka Sinko & Juha Kilponen, 2003. "Does Centralised Wage Setting Lead into Higher Taxation?," Discussion Papers 314, Government Institute for Economic Research Finland (VATT). [Downloadable!]
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  7. Jaakko Kiander & Elina Berghäll, 2003. "The Finnish Model of STI Policy: Experiences and Guidelines. KNOGG Thematic Network WP4 Country Report - Finland," Discussion Papers 313, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  8. Pekka Sulamaa & Mika Widgrén, 2004. "EU-Enlargement and Beyond: A Simulation Study on EU and Russia Integration," Discussion Papers 356, Government Institute for Economic Research Finland (VATT). [Downloadable!]
    Other versions:
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