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Do small labor market entry cohorts reduce unemployment?

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  • Garloff, Alfred

    ()
    (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])

  • Pohl, Carsten

    ()
    (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])

  • Schanne, Norbert

    ()
    (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])

Abstract

"In this paper we study the effect of small labor market entry cohorts on (un)employment in Western Germany. From a theoretical point of view, decreasing cohort sizes may on the one hand reduce unemployment due to 'inverse cohort crowding' or on the other hand increase unemployment if companies reduce jobs disproportionately. Consequently, the actual effect of cohort shrinking on (un)employment is an empirical question. We analyze the relationship between (un)employment and cohort sizes using a long panel of Western German labor market regions. In this context, we account for both the likely endogeneity of cohort size due to migration of the (young) workforce across regions using lagged births as instruments as well as for temporal and spatial autocorrelation. Our results provide good news for the (Western) German labor market: small entry cohorts are indeed likely to decrease the overall unemployment rate and thus to improve the situation of job seekers. Accordingly, with regard to the employment rate we find that it is positively affected by a decrease in the youth share." (Author's abstract, IAB-Doku) ((en))

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Bibliographic Info

Paper provided by Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany] in its series IAB Discussion Paper with number 201118.

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Length: 33 pages
Date of creation: 12 Sep 2011
Date of revision:
Publication status: published in: Demographic Research, Vol. 29, Art. 15 (2013), p. 379-406
Handle: RePEc:iab:iabdpa:201118

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Keywords: demografischer Wandel - Auswirkungen; Arbeitslosenquote; Bevölkerungsstruktur; Altersstruktur; regionaler Vergleich; Bevölkerungsrückgang; Beschäftigungseffekte; Arbeitsuchende; Arbeitsmarktchancen; Geburtenrückgang; Jugendliche; junge Erwachsene; demografischer Wandel - internationaler Vergleich; Westdeutschland; Bundesrepublik Deutschland; OECD;

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References

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Citations

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Cited by:
  1. Caliendo, Marco & Hogenacker, Jens & Künn, Steffen & Wießner, Frank, 2011. "Alte Idee, neues Programm: Der Gründungszuschuss als Nachfolger von Überbrückungsgeld und Ich-AG," IAB Discussion Paper 201124, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  2. Zapfel, Stefan & Promberger, Markus, 2011. "Gemeinschaft, Gesellschaft und soziale Sicherung : Überlegungen zu Genese und Wandel des modernen Wohlfahrtsstaats," IAB Discussion Paper 201121, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  3. Engelmann, Sabine, 2011. "Trade liberalisation, technical change and skill-specific unemployment," IAB Discussion Paper 201119, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  4. Schmelzer, Paul, 2011. "Unemployment and occupational mobility at the beginning of employment career in Germany and the UK," IAB Discussion Paper 201125, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  5. Alfred Garloff & Rüdiger Wapler, 2013. "Are the Number of Skilled Workers Running Out in Germany? The (Non)-Consequences of Demographic Change," ERSA conference papers ersa13p854, European Regional Science Association.

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