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Do Scarring Effects of Low-Wage Employment and Non-Employment Differ BETWEEN Levels of Qualification?

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  • Alexander Mosthaf

Abstract

type="main" xml:id="sjpe12039-abs-0001"> This study investigates how the effects of low-wage employment and non-employment on wage prospects vary depending on qualification. Based on theories on signalling effects, human capital and job search, we discuss why there may be heterogeneity in state dependence in both labour market states. We find that episodes of low-wage employment incur a significantly lower risk of future non-employment than episodes of non-employment for low-qualified workers. In contrast, for workers with a middle or high level of qualification the risk of non-employment is not significantly different when being low-paid instead of not employed.

Suggested Citation

  • Alexander Mosthaf, 2014. "Do Scarring Effects of Low-Wage Employment and Non-Employment Differ BETWEEN Levels of Qualification?," Scottish Journal of Political Economy, Scottish Economic Society, vol. 61(2), pages 154-177, May.
  • Handle: RePEc:bla:scotjp:v:61:y:2014:i:2:p:154-177
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    File URL: http://hdl.handle.net/10.1111/sjpe.2014.61.issue-2
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    Cited by:

    1. Plum, Alexander & Knies, Gundi, 2015. "Earnings prospects for low-paid workers higher than for the unemployed but only in high-pay areas with high unemployment," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112845, Verein für Socialpolitik / German Economic Association.
    2. Claus Schnabel, 2021. "Low-wage employment," IZA World of Labor, Institute of Labor Economics (IZA), pages 276-276, March.
    3. Plum, Alexander & Knies, Gundi, 2015. "Does neighbourhood unemployment affect the springboard effect of low pay?," ISER Working Paper Series 2015-20, Institute for Social and Economic Research.
    4. Alexander Plum, 2016. "Reconsidering the interrelated dynamics of unemployment and low-wage employment in Great Britain," Economics Bulletin, AccessEcon, vol. 36(2), pages 1230-1241.
    5. Schnitzlein, Daniel D. & Stephani, Jens, 2016. "Locus of Control and low-wage mobility," Journal of Economic Psychology, Elsevier, vol. 53(C), pages 164-177.
    6. Kabir Dasgupta & Alexander Plum, 2020. "Human Capital Formation and Changes in Low Pay Persistence," Working Papers 2020-15, Auckland University of Technology, Department of Economics.

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