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The Impact of Education on Unemployment Incidence and Re-employment Success: Evidence from the U.S. Labour Market

W. Craig Riddell () and Xueda Song ()

CLSSRN working papers from Vancouver School of Economics

Abstract: This study investigates the causal effects of education on individuals’ transitions between employment and unemployment, with particular focus on the extent to which education improves re-employment outcomes among unemployed workers. Given that positive correlations between education and labour force transitions are likely to be confounded by the endogeneity of education, we make use of data on compulsory schooling laws and child labour laws as well as conscription risk in the Vietnam War period to create instrumental variables to identify the causal relationships. Results indicate that education significantly increases re-employment rates of the unemployed. Particularly large impacts are found in the neighborhoods of 12 and 16 years of schooling. Evidence on the impact of formal schooling on unemployment incidence is mixed.

Keywords: education; labour market transitions; unemployment; causal effects; compulsory schooling laws; child labour laws; Vietnam War draft (search for similar items in EconPapers)
JEL-codes: I20 J64 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2011-07-27, Revised 2011-07-27
New Economics Papers: this item is included in nep-edu and nep-lab
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http://www.clsrn.econ.ubc.ca/workingpapers/CLSRN%2 ... ell%20and%20Song.pdf (application/pdf)

Related works:
Journal Article: The impact of education on unemployment incidence and re-employment success: Evidence from the U.S. labour market (2011) Downloads
Working Paper: The Impact of Education on Unemployment Incidence and Re-employment Success: Evidence from the U.S. Labour Market (2011) Downloads
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