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Does labor force participation rates of youth vary within the business cycle? Evidence from Germany and Poland

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  • Dunsch, Sophie

Abstract

Unemployment rates, especially among youth, have increased in various countries of Europe over the last years. As labor force participation rate is one key influence on unemployment, I estimate country specific coefficients for the responsiveness of the labor force participation rates to the business cycle for different age cohorts. The results show that an influence of the business cycle on movements of the participation rates are only statistically significant for the youngest age cohort of the 15-to-24-years old in Germany, suggesting a discouraged worker effect.

Suggested Citation

  • Dunsch, Sophie, 2016. "Does labor force participation rates of youth vary within the business cycle? Evidence from Germany and Poland," Discussion Papers 386, European University Viadrina Frankfurt (Oder), Department of Business Administration and Economics.
    • Handle: RePEc:zbw:euvwdp:386
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    References listed on IDEAS

    as
    1. Stephanie Aaronson & Bruce Fallick & Andrew Figura & Jonathan Pingle & William Wascher, 2006. "The Recent Decline in the Labor Force Participation Rate and Its Implications for Potential Labor Supply," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 37(1), pages 69-154.
    2. Katharine L. Bradbury, 2005. "Additional slack in the economy: the poor recovery in labor force participation during this business cycle," Public Policy Brief, Federal Reserve Bank of Boston.
    3. Stephanie Aaronson & Tomaz Cajner & Bruce Fallick & Felix Galbis-Reig & Christopher Smith & William Wascher, 2014. "Labor Force Participation: Recent Developments and Future Prospects," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 45(2 (Fall)), pages 197-275.
    4. Daniel Aaronson & Kyung-Hong Park & Daniel G. Sullivan, 2006. "The decline in teen labor force participation," Economic Perspectives, Federal Reserve Bank of Chicago, vol. 30(Q I), pages 2-18.
    5. Pastore, Francesco, 2005. "To Study or to Work? Education and Labour Market Participation of Young People in Poland," IZA Discussion Papers 1793, Institute of Labor Economics (IZA).
    6. Benito, Andrew & Bunn, Philip, 2011. "Understanding labour force participation in the United Kingdom," Bank of England Quarterly Bulletin, Bank of England, vol. 51(1), pages 36-42.
    7. David N. F. Bell & David G. Blanchflower, 2011. "Young people and the Great Recession," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 27(2), pages 241-267.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Youth Unemployment; Youth Labor Force Participation; Poland; Germany; Business Fluctuations;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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