The Effects of Graduating from High School in a Recession: College Investments, Skill Formation, and Labor-Market Outcomes

Franziska Hampf, Marc Piopiunik and Simon Wiederhold ()

No 8252, CESifo Working Paper Series from CESifo

Abstract: We investigate the short- and long-term effects of economic conditions at high-school graduation as a source of exogenous variation in the labor-market opportunities of potential college entrants. Exploiting business cycle fluctuations across birth cohorts for 28 developed countries, we find that bad economic conditions at high-school graduation increase college enrollment and graduation. They also affect outcomes in later life, increasing cognitive skills and improving labor-market success. Outcomes are affected only by the economic conditions at high-school graduation, but not by those during earlier or later years. Recessions at high-school graduation narrow the gender gaps in numeracy skills and labor-market success.

Keywords: business cycle; college enrollment; skill formation; labor-market outcomes; PIAAC; gender gap (search for similar items in EconPapers)
JEL-codes: E32 I21 I23 J24 (search for similar items in EconPapers)
Date: 2020
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 (8)

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