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Bye Bye, G.I. - The Impact of the U.S. Military Drawdown on Local German Labor Markets

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  • Jan Peter aus dem Moore
  • Alexandra Spitz-Oener

Abstract

What is the impact of a local negative demand shock on local labor markets? We exploit the unique natural experiment provided by the drawdown of U.S. military forces in West Germany after the end of the Cold War to investigate this question. We find persistent negative effects of the reduction in the U.S. forces on private sector employment, with con- siderable heterogeneity in terms of age and education groups, and sectors. In addition, the U.S. forces reduction resulted in a rise in local unemployment, whereas migration patterns and wages were not affected.

Suggested Citation

  • Jan Peter aus dem Moore & Alexandra Spitz-Oener, 2012. "Bye Bye, G.I. - The Impact of the U.S. Military Drawdown on Local German Labor Markets," SFB 649 Discussion Papers SFB649DP2012-024, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
    • Handle: RePEc:hum:wpaper:sfb649dp2012-024
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    References listed on IDEAS

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    3. Alfredo Paloyo & Colin Vance & Matthias Vorell, 2014. "Local determinants of crime," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 31(21), pages 625-658.

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    More about this item

    Keywords

    Labor demand shock; Base closure; Employment; Wages;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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