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Improvement in European labor force participation

Daniel Gros

IZA World of Labor, 2019, No 449, 449

Abstract: Employment and labor force participation (LFP) rates have increased throughout Europe since the 1990s, with little interruption from the Great Recession. While many credit labor market reforms for this progress, ongoing educational expansion might actually be more important. This implies that the overall employment rate of an economy can change if the share of the population with tertiary education increases, even in the absence of any labor market reforms or effects of the business cycle. Taking this compositional effect into account makes it possible to disentangle the impact of reforms.

Keywords: human capital; labor market reforms; tertiary education; aging (search for similar items in EconPapers)
JEL-codes: J01 J21 J24 J26 (search for similar items in EconPapers)
Date: 2019
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