Scars of Recessions in a Rigid Labor Market

Bart Cockx and Corinna Ghirelli

No 2015005, LIDAM Discussion Papers IRES from Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES)

Abstract: 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.

Keywords: scars; graduating; labor market rigidity; recession; few clusters; cluster robust (search for similar items in EconPapers)
JEL-codes: C12 C41 E32 I21 J22 J23 J31 J6 (search for similar items in EconPapers)
Pages: 41
Date: 2015-02-25
New Economics Papers: this item is included in nep-lma and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Related works:
Journal Article: Scars of recessions in a rigid labor market (2016)
Working Paper: Scars of Recessions in a Rigid Labor Market (2015)
Working Paper: Scars of Recessions in a Rigid Labor Market (2015)
Working Paper: SCARS OF RECESSIONS IN A RIGID LABOR MARKET (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:ctl:louvir:2015005

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