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Caught in the Cycle: Economic Conditions at Enrollment and Labor Market Outcomes of College Graduates

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  • Alena Bicakova
  • Guido Matias Cortes
  • Jacopo Mazza

Abstract

We find robust evidence that cohorts of graduates who enter college during worse economic times earn higher average wages than those who enter during better times. This difference is not explained by differences in economic conditions at the time of college graduation, changes in _eld of study composition, or changes in selection into occupations or industries. Cohorts who start college in bad times are not more positively selected based on their high-school outcomes, but they graduate with higher college grades, and earn higher wages conditional on their grades. Our results suggest that these cohorts exert more effort during their studies.

Suggested Citation

  • Alena Bicakova & Guido Matias Cortes & Jacopo Mazza, 2018. "Caught in the Cycle: Economic Conditions at Enrollment and Labor Market Outcomes of College Graduates," CERGE-EI Working Papers wp622, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
  • Handle: RePEc:cer:papers:wp622
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    More about this item

    Keywords

    business cycle; higher education; cohort effects;

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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