Scandinavian Working Papers in Economics

Arbetsrapport,
Institute for Futures Studies

No 2009:2: Unemployment and subsequent earnings for Swedish college graduates. A study of scarring effects

Marie Gartell ()
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Marie Gartell: Institute for Futures Studies, Postal: Box 591, SE-101 31 Stockholm, Sweden

Abstract: The purpose of this paper is to study the long term effects of the college-to-work transition. The results reveal that unemployment immediately upon graduation has substantial and permanent effects on individual future earnings. Even for very short unemployment spells, estimated effects are statistically significant. These results are stable for the inclusion of a rich set of observable control variables, including grade point average from high school and parental educational level, and for choice of method i.e. OLS and propensity score matching.

Keywords: Scarring; State dependence; Higher education; College-to-work

JEL-codes: J24; J31; J64

37 pages, January 2009

Price: 25 SEK

Note: ISSN:1652-120X; ISBN:978-91-85619-41-2

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