Which degrees do students prefer during recessions?

Rigissa Megalokonomou and Sofoklis Goulas

MPRA Paper from University Library of Munich, Germany

Abstract: We examine how changes in the unemployment rate affect demand for college education, demand for different fields of university study and degrees' admission thresholds. We use panel data for applications submitted to the universe of undergraduate programs in Greece that span seven rounds of admission cohorts combined with a degree-specific job insecurity index, and time series on youth (ages 18-25) unemployment. We find that degree- and major-specific job insecurity turns applicants away from degrees and majors that are associated with poor employment prospects. Results indicate that the steep increase in the unemployment rate that started in 2009 is associated with an increase in the number of college applicants. The effect is heterogeneous across fields, with an increase in the demand for degrees in Psychology as well as for entrance to Naval, Police and Military Academies, and a decrease in the demand for degrees in Business and Management. We also find that the business cycle changes degrees' admission thresholds by affecting their popularity.

Keywords: demand for education; college major; unemployment; job insecurity; admission thresholds (search for similar items in EconPapers)
JEL-codes: I21 I23 I26 J44 (search for similar items in EconPapers)
Date: 2016-12-01
New Economics Papers: this item is included in nep-edu and nep-eur
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Citations: View citations in EconPapers (2)

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Journal Article: Which degrees do students prefer during recessions? (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:75355

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