Scarring Effect in Labor Market and Its Governance
Matching the micro data from labor market and macro data of economic growth,the paper identifies the scarring effect in Chinese labor market.The result of the empirical analysis shows that,the individuals who first enter labor market in a recession in-stead of boom period suffer a 7 percent income loss compared with those who enter in a boom,and with a one percent decrease of the macro economic growth in individual's graduation year,the current individual income will lower about two percent.The effect lasts for ten years and keeps constant during the time span,showing that the scarring effect of labor market exists.The result of the hetero-geneity analysis shows that,the male individual,the individual with a college degree or higher,with a non-agriculture Hukou,work-ing out of the system,is hit more terribly by the initial macroeconomic condition.The key mechanism lies in that,the initial econom-ic condition plays a longtime lasting effect through individual's opportunity of job adjustment.Meanwhile,both marketization and employment protection institution by government play a role to alleviate the above effect.The findings of the paper means,no matter for individual welfare or the nation's common prosperity target,it is meaningful at present to keep a stable short-term economic growth rate.
Economic Growth VolatilityIndividual IncomeScarring EffectIncome Gap
万方数据
