Caught in the Cycle: Economic Conditions at Enrollment and Labor Market Outcomes of College Graduates

Alena Bičáková, Guido Matias Cortes and Jacopo Mazza

No 13561, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We find robust evidence that cohorts of male graduates who start college during worse economic times earn higher average wages than those who start during better times. This gap is not explained by differences in selection into employment, in economic conditions at the time of college graduation, or in field of study choices. Graduates who enroll in bad times are not more positively selected based on their high-school outcomes, but they achieve higher college grades, sort into higher-paying occupations, and earn higher wages conditional on their grades. We find similar but less robust patterns for female graduates. Our results suggest that individuals who enroll during economic downturns exert more effort during their studies.

Keywords: cohort effects; higher education; business cycle (search for similar items in EconPapers)
JEL-codes: E32 I23 J24 J31 (search for similar items in EconPapers)
Pages: 65 pages
Date: 2020-07
New Economics Papers: this item is included in nep-lma and nep-mac
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Citations: View citations in EconPapers (2)

Published - published in: Economic Journal, 2021, 131 (638), 2383-2412.

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Related works:
Journal Article: Caught in the Cycle: Economic Conditions at Enrolment and Labour Market Outcomes of College Graduates (2021)
Working Paper: Caught in the cycle: Economic conditions at enrollment and labor market outcomes of college graduates (2020)
Working Paper: Caught in the Cycle: Economic Conditions at Enrollment and Labor Market Outcomes of College Graduates (2018)
Working Paper: Caught in the Cycle: Economic Conditions at Enrollment and Labor Market Outcomes of College Graduates (2018)
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