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Unemployment and subsequent earnings for Swedish college graduates: a study of scarring effects

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  • Gartell, Marie

    () (Institute for Futures Studies)

Abstract

Unemployment immediately upon graduation is associated with substantial and permanent future earnings losses. Even for very short unemployment spells the estimated earnings losses are statistically significant. These results are stable for the inclusion of a rich set of observable control variables, including grade point average from high school and parental educational level, and for choice of method i.e. OLS and propensity score matching. This lends some support for the interpretation that unemployment upon graduation has the causal effect of reducing future earnings prospects.

Suggested Citation

  • Gartell, Marie, 2009. "Unemployment and subsequent earnings for Swedish college graduates: a study of scarring effects," Working Paper Series 2009:10, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  • Handle: RePEc:hhs:ifauwp:2009_010
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    File URL: http://www.ifau.se/upload/pdf/se/2009/wp09-10.pdf
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    References listed on IDEAS

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    1. Philip Oreopoulos & Till von Wachter & Andrew Heisz, 2006. "The Short- and Long-Term Career Effects of Graduating in a Recession: Hysteresis and Heterogeneity in the Market for College Graduates," NBER Working Papers 12159, National Bureau of Economic Research, Inc.
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    6. Paul Gregg & Emma Tominey, 2004. "The Wage Scar from Youth Unemployment," The Centre for Market and Public Organisation 04/097, Department of Economics, University of Bristol, UK.
    7. Virve Ollikainen, 2006. "Gender Differences in Transitions from Unemployment: Micro Evidence from Finland," LABOUR, CEIS, vol. 20(1), pages 159-198, March.
    8. Carlsson, Magnus & Rooth, Dan-Olof, 2007. "Evidence of ethnic discrimination in the Swedish labor market using experimental data," Labour Economics, Elsevier, vol. 14(4), pages 716-729, August.
    9. Claudio Lupi & Patrizia Ordine, 2002. "Unemployment scarring in high unemployment regions," Economics Bulletin, AccessEcon, vol. 10(2), pages 1-8.
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    13. Betts, Julian & Ferrall, Christopher & Finnie, Ross, 2000. "The Transition to Work for Canadian University Graduates: Time to First Job, 1982-1990," Analytical Studies Branch Research Paper Series 2000141e, Statistics Canada, Analytical Studies Branch.
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    16. Biewen, Martin & Steffes, Susanne, 2010. "Unemployment persistence: Is there evidence for stigma effects?," Economics Letters, Elsevier, vol. 106(3), pages 188-190, March.
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    Cited by:

    1. M. Gartell, 2012. "The college-to-work transition during the 1990s: evidence from Sweden," Applied Economics, Taylor & Francis Journals, vol. 44(11), pages 1449-1469, April.
    2. Fujii, Mayu & Shiraishi, Kousuke & Takayama, Noriyuki, 2013. "The Determinants and Effects of Early Job Separation in Japan," CIS Discussion paper series 590, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    3. Corinna.Ghirelli, 2014. "The scarring effect of early non-employment," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 14/895, Ghent University, Faculty of Economics and Business Administration.
    4. repec:rss:jnljsh:v3i5p4 is not listed on IDEAS

    More about this item

    Keywords

    Scarring; State dependence; Higher education; College-to-work;

    JEL classification:

    • 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
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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