Full Citation
Title: The Great Depression of Income: Historical Estimates of the Long-Term Effect of Entering the Labor Market During a Recession
Citation Type: Miscellaneous
Publication Year: 2016
ISBN:
ISSN:
DOI:
NSFID:
PMCID:
PMID:
Abstract: In this paper I use three different approaches to estimate the long-run impact of variation in labor market entry conditions, driven by the Great Depression, on income and other labor outcomes in the 1940 Census. I find a strong relationship between income and state level wage worker employment and wages (from the Census of Manufacturers) measured in the year an individual became working aged, using a birth state and birth cohort fixed effects model. In the second approach I use a regression discontinuity and find that 10 years after entry, less educated men entering the labor market at the beginning of the Great Depression in 1930 earned 8.1 percent less than entrants just one year prior. Lastly, I combine the first and second approaches to estimate the regression discontinuity for two samples stratified by severity of the Great Depression in the observations birth state (data from Wallis, 1989). I find that the effect is larger (14.6 percent) for those born in states more negatively affected by the Great Depression and close to zero for those born in states relatively less affected
Url: http://bryan.uncg.edu/econ/files/2016/10/Great-Depression-of-Income-Moulton.pdf
User Submitted?: No
Authors: Moulton, Jeremy G
Publisher: University of North Carolina, Chapel Hill
Data Collections: IPUMS USA
Topics: Labor Force and Occupational Structure, Other, Poverty and Welfare
Countries: