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Estimating the Labor Market Impact of Voluntary Military Service Using Social Security Data on Military Applicants

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  • Joshua D. Angrist

Abstract

Effects of military service on veterans' earnings are estimated using Social Security administrative records to fit models with heterogeneous potential outcomes. The first estimation strategy uses matching and regression to compare applicants who enlisted with applicants who did not enlist. The second uses instrumental variables generated by an error in military entrance exams. The empirical results suggest that military service led to higher employment rates for veterans. But in spite of this employment gain, voluntary military service led to only a modest increase in the civilian earnings of nonwhite veterans while actually reducing the civilian earnings of white veterans.

Suggested Citation

  • Joshua D. Angrist, 1998. "Estimating the Labor Market Impact of Voluntary Military Service Using Social Security Data on Military Applicants," Econometrica, Econometric Society, vol. 66(2), pages 249-288, March.
    • Handle: RePEc:ecm:emetrp:v:66:y:1998:i:2:p:249-288
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    1. Mark C. Berger & Barry T. Hirsch, 1983. "The Civilian Earnings Experience of Vietnam - Era Veterans," Journal of Human Resources, University of Wisconsin Press, vol. 18(4), pages 455-479.
    2. Card, David & Sullivan, Daniel G, 1988. "Measuring the Effect of Subsidized Training Programs on Movements in and out of Employment," Econometrica, Econometric Society, vol. 56(3), pages 497-530, May.
    3. Don Bellante, 1994. "Labor economics," Chapters, in: Peter J. Boettke (ed.), The Elgar Companion to Austrian Economics, chapter 37, Edward Elgar Publishing.
    4. Newey, Whitney K, 1990. "Efficient Instrumental Variables Estimation of Nonlinear Models," Econometrica, Econometric Society, vol. 58(4), pages 809-837, July.
    5. Bryant, Richard R. & Samaranayake, V. A. & Wilhite, Allen, 1993. "The effect of military service on the subsequent civilian wage of the post-Vietnam veteran," The Quarterly Review of Economics and Finance, Elsevier, vol. 33(1), pages 15-31.
    6. Imbens, Guido W & Angrist, Joshua D, 1994. "Identification and Estimation of Local Average Treatment Effects," Econometrica, Econometric Society, vol. 62(2), pages 467-475, March.
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    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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