Working Papers,
Lund University, Department of Economics

Abstract: This study examines the response among young adults to the closure of a large local employer. By using military base closures in Sweden, I find that men experience lower earnings and enroll in tertiary education. This is driven by low-ability men who choose short-term enrollment at nearby colleges and universities. For women, the closures have a positive impact after some years, with increases in both earnings and employment rates, suggesting that closing down a male-dominated employer can benefit the female labor supply.

Keywords: local economic downturn; plant closure; defense cutback; tertiary education; labor market entrants

JEL-codes: H56; I23; J24

Language: English

43 pages, October 21, 2024

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