Going Back to School Takes Time: Evidence from a Negative Trade Shock

36 Pages Posted: 14 Feb 2020

See all articles by Jean-Denis Garon

Jean-Denis Garon

University of Quebec at Montreal (UQAM)

Catherine Haeck

University of Quebec at Montreal (UQAM) - Université du Québec à Montréal

Simon Bourassa-Viau

Viau Statistics

Date Written: 2020

Abstract

We estimate the impact of a negative trade shock on labour market outcomes and educational choices of workers. We exploit the Canadian lumber exports crisis beginning in 2007 in a quasi-experimental design. We find that the employment probability of forestry industry workers decreased by 4.1 percentage points following the crisis relative to other workers in comparable industries. While one would expect younger forestry workers to return to school in such circumstances, we find that in the first two years following the crisis, unemployed workers did not go back to school. But going back to school takes time, and after 3 to 4 years, we find that education enrollment increases by 2.5 percentage points (p=0.083). This confirms the idea that adjustments towards an increase in education enrollment are gradual, as it is easier to drop out than to enroll. In time of crisis, facilitating a return to education might be a valuable policy intervention.

Keywords: educational choices, school enrollment trade shock

JEL Classification: I200, I260, I280

Suggested Citation

Garon, Jean-Denis and Haeck, Catherine and Bourassa-Viau, Simon, Going Back to School Takes Time: Evidence from a Negative Trade Shock (2020). CESifo Working Paper No. 8094, Available at SSRN: https://ssrn.com/abstract=3538007 or http://dx.doi.org/10.2139/ssrn.3538007

Jean-Denis Garon (Contact Author)

University of Quebec at Montreal (UQAM) ( email )

PB 8888 Station DownTown
Succursale Centre Ville
Montreal, Quebec H3C3P8
Canada

Catherine Haeck

University of Quebec at Montreal (UQAM) - Université du Québec à Montréal ( email )

CP 8888 Succ Centre Ville
Montréal, Québec H3C3P8
Canada

Simon Bourassa-Viau

Viau Statistics ( email )

Canada

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