Abstract
We examine effects of entering the labor market during a recession on subsequent employment and earnings for Japanese and American men, using comparable household labor force surveys. We find persistent negative effects of the unemployment rate at graduation for less-educated Japanese men, in contrast to temporary effects for less-educated American men. The school-based hiring system and the dismissal regulation prolong the initial loss of employment opportunities for less-educated Japanese men. The effect on earnings for more-educated groups is also stronger in Japan, although the difference between the two countries is smaller than for less-educated groups.
- Received September 2007.
- Accepted October 2008.
In this issue
Jump to section
- Article
- Abstract
- I. Introduction
- II. Institutional Background
- III. Underlying Mechanisms
- IV. Data and Methodology
- V. Estimated Effects of a Recession at Entry
- VI. Concluding Remarks
- Appendix 1 Earnings Data
- Appendix 2 Measurement Errors Caused by Migration across Regions and Skipped/Repeated Grades
- Appendix 3 Business Cycles and Schooling Choice
- Appendix 4 Sensitivity Check
- Appendix 5 Controlling for Industries
- Footnotes
- References
- Figures & Data
- Info & Metrics
- References