Caught in the Cycle: Economic Conditions at Enrollment and Labor Market Outcomes of College Graduates

CERGE-EI Working Paper Series No. 622

54 Pages Posted: 15 Aug 2018

Date Written: July 17, 2018

Abstract

We find robust evidence that cohorts of graduates who enter college during worse economic times earn higher average wages than those who enter during better times. This difference is not explained by differences in economic conditions at the time of college graduation, changes in field of study composition, or changes in selection into occupations or industries. Cohorts who start college in bad times are not more positively selected based on their high-school outcomes, but they graduate with higher college grades, and earn higher wages conditional on their grades. Our results suggest that these cohorts exert more effort during their studies.

Keywords: Business Cycle, Higher Education, Cohort Effects

JEL Classification: I23, J24, J31, E32

Suggested Citation

Bicakova, Alena and Cortes, Guido Matias and Mazza, Jacopo, Caught in the Cycle: Economic Conditions at Enrollment and Labor Market Outcomes of College Graduates (July 17, 2018). CERGE-EI Working Paper Series No. 622, Available at SSRN: https://ssrn.com/abstract=3223479 or http://dx.doi.org/10.2139/ssrn.3223479

Alena Bicakova (Contact Author)

CERGE-EI, Prague ( email )

Politickych veznu 7
Prague 1, 111 21
Czech Republic

HOME PAGE: http://www.cerge-ei.cz

Guido Matias Cortes

York University ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

Jacopo Mazza

University of Essex ( email )

Wivenhoe Park
Colchester, CO4 3SQ
United Kingdom

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