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Durham University

Research & business

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Publication details

Moffat, J. & Roth, D. (2016). The cohort size-wage relationship in Europe. LABOUR: Review of Labour Economics and Industrial Relations 30(4): 415-432.

Author(s) from Durham

Abstract

This paper estimates the impact of cohort size on wages using data on young males in European regions covering 2004-2010. The effect of cohort size on wages is identified through an instrumental variables strategy which, in contrast to previous analyses of European data, addresses self-selection into geographical areas as well as into educational groups. The results suggest that cohort size has a significant negative effect on male wages for individuals with secondary education – the largest group – but not for individuals with less than secondary education or tertiary education. This effect is underestimated if self-selection into geographical areas is not addressed.