Demographic and Education Effects on Unemployment in Europe: Economic Factors and Labour Market Institutions
We analyse the effects of demographic and education changes on unemployment rates in Europe. Using a panel of European countries for the 1980-2000 period - disaggregated by cohort, gender and education -, we empirically test the economic effects of two stylised facts that have occurred in recent decades: the "baby bust" and the "education boom". We find that structural shifts in the population age structure play an important role and that a lot of variation is also attributable to educational changes, the latter usually neglected in aggregate studies. Results show that demographic and education shocks are qualitatively different for young (adult) workers as well as for more (less) educated people. While adult workers and more educated individuals, in general, experience lower unemployment rates, changes in the population age structure appear to be positively related to young workers' unemployment rates while they have no effect on adults. Conversely changes in the skill structure ("education boom"), even when controlling for skill-biased technological change, reduce the unemployment of the more educated. Labour market institutions also influence unemployment rates in different ways. Unemployment benefits are found to have a positive impact on unemployment, while bargaining coordination and employment protection reduce it.
|Date of creation:||Oct 2005|
|Date of revision:|
|Publication status:||published in: Labour Economics, 2008, 15(5), 1076-1101|
|Contact details of provider:|| Postal: |
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Acemoglu, Daron & Aghion, Philippe & Violante, Giovanni L., 2001.
"Deunionization, technical change and inequality,"
Carnegie-Rochester Conference Series on Public Policy,
Elsevier, vol. 55(1), pages 229-264, December.
- Bertola, Giuseppe & Blau, Francine D & Kahn, Lawrence, 2001.
"Comparative Analysis of Labour Market Outcomes: Lessons for the US from International Long-Run Evidence,"
CEPR Discussion Papers
3023, C.E.P.R. Discussion Papers.
- Giuseppe Bertola & Francine D. Blau & Lawrence M. Kahn, 2001. "Comparative Analysis of Labor Market Outcomes: Lessons for the US from International Long-Run Evidence," NBER Working Papers 8526, National Bureau of Economic Research, Inc.
- Bertola, Giuseppe & Blau, Francine D & Kahn, Lawrence, 2002.
"Labour Market Institutions and Demographic Employment Patterns,"
CEPR Discussion Papers
3448, C.E.P.R. Discussion Papers.
- Giuseppe Bertola & Francine Blau & Lawrence Kahn, 2007. "Labor market institutions and demographic employment patterns," Journal of Population Economics, Springer, vol. 20(4), pages 833-867, October.
- Giuseppe Bertola & Francine D. Blau & Lawrence M. Kahn, 2002. "Labor Market Institutions and Demographic Employment Patterns," NBER Working Papers 9043, National Bureau of Economic Research, Inc.
- Brunello, Giorgio & Lauer, Charlotte, 2004.
"Are Wages in Southern Europe More Flexible? The Effects of Cohort Size on European Earnings,"
IZA Discussion Papers
1299, Institute for the Study of Labor (IZA).
- Brunello, Giorgio & Lauer, Charlotte, 2005. "Are Wages in Southern Europe more Flexible? The Effects of a Cohort Size on European Earnings," ZEW Discussion Papers 05-45, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Daron Acemoglu, 2002.
"Cross-Country Inequality Trends,"
NBER Working Papers
8832, National Bureau of Economic Research, Inc.
- David Card & Thomas Lemieux, 2000.
"Can Falling Supply Explain the Rising Return to College for Younger Men? A Cohort-Based Analysis,"
NBER Working Papers
7655, National Bureau of Economic Research, Inc.
- David Card & Thomas Lemieux, 2001. "Can Falling Supply Explain The Rising Return To College For Younger Men? A Cohort-Based Analysis," The Quarterly Journal of Economics, MIT Press, vol. 116(2), pages 705-746, May.
When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp1806. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak)
If references are entirely missing, you can add them using this form.