The author passed away on March 2012, and he is sorely missed by his friends and colleagues.
A Distributional Analysis of Earnings Losses of Displaced Workers in an Economic Depression and Recovery†
Version of Record online: 12 APR 2013
© 2013 The Department of Economics, University of Oxford and JohnWiley & Sons Ltd.
Oxford Bulletin of Economics and Statistics
Volume 76, Issue 4, pages 565–588, August 2014
How to Cite
korkeamäki, O. and kyyrä, T. (2014), A Distributional Analysis of Earnings Losses of Displaced Workers in an Economic Depression and Recovery. Oxford Bulletin of Economics and Statistics, 76: 565–588. doi: 10.1111/obes.12028
We are grateful to Jukka Appelqvist for his help with the data and preliminary analysis. We thank two anonymous reviewers, Kristiina Huttunen, Matti Sarvimäki, Jouko Verho and Ralf Wilke, as well as participants at the EALE Conference in Oslo, the ESPE Conference in Chicago, the EcoMod Conference in Sao Paolo, the Annual Meeting of the Finnish Society for Economic Research in Lappeenranta and the HECER Workshop on Labour Turnover and Firm Performance in Helsinki for helpful comments.
- Issue online: 3 JUL 2014
- Version of Record online: 12 APR 2013
- Manuscript Received: MAR 2013
We study the earnings losses of Finnish private sector workers who lost their jobs at two very different points in the business cycle. The first group wdisplad in 1992 (depression period) and the second one in 1997 (recovery period). The focal point of the analysis is the quantile displacement effect, the change in the earnings distribution due to involuntary job separation. We use mass layoffs and plant closures to identify groups of workers who were displaced from exogenous causes. The effect of displacement is strongest at the lower end of the earnings distribution and small or negligible at the upper end. Workers displaced during the depression period are subject to much larger earnings losses.