Scars of Recessions in a Rigid Labor Market

Arbeitspapier

We study the impact of graduating in a recession in Flanders (Belgium), i.e. in a rigid labor market. In the presence of a high minimum wage, a typical recession hardly influences the hourly wage of low educated men, but reduces working time and earnings by about 4.5% up to twelve years after graduation. For the high educated, the working time is not persistently affected, but the penalty on the hourly wage (and earnings) increases with experience, and attains roughly -6% ten years after labor market entry. We also contribute to the literature on inference with few clusters.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 5240

Classification and Topics

• Classification: Wirtschaft ; Hypothesis Testing: General ; Duration Analysis; Optimal Timing Strategies ; Business Fluctuations; Cycles ; Analysis of Education ; Time Allocation and Labor Supply ; Labor Demand ; Wage Level and Structure; Wage Differentials ; Mobility, Unemployment, Vacancies, and Immigrant Workers: General
• Subject: scars ; graduating ; labor market rigidity ; recession ; few clusters ; cluster robust

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Cockx, Bart ; Ghirelli, Corinna
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2015

Further information

• Handle: http://hdl.handle.net/10419/108787
• Last update: 10.03.2025, 11:41 AM CET