Skip to main content
IZA Journal of European Labor Studies

Table 9 Effect of interest excluding \(\overline {UR}_{p}\) and m i n U R pt from the specification

From: Scars of early non-employment for low educated youth: evidence and policy lessons from Belgium

Panel A: Effect of early non-employment in the structural equation:

 
  

OLS

2SLS

Standard errors a

Robust

Cluster g∗p

Robust

Cluster g∗p

Outcomes: b

 

(1)

(2)

(3)

(4)

Salaried employment

coeff

–0.00169***

–0.00169***

–0.00199

–0.00199

 

se

(0.00034)

(0.00041)

(0.00387)

(0.00348)

 

P-val

 

0.00019

 

0.57020

 

Bootstrap P-val c

 

0.00000

 

0.62462

 

Exogeneity test P-val d

  

0.937

0.931

Self-employment

coeff

0.00054*

0.00054

0.00219

0.00219

 

se

(0.00030)

(0.00041)

(0.00340)

(0.00313)

 

P-val

 

0.19253

 

0.48668

 

Bootstrap P-val

 

0.19219

 

0.52853

 

Exogeneity test P-val

 

0.619

 

0.587

Overall employment

coeff

–0.00115***

–0.00115***

0.00020

0.00020

 

se

(0.00021)

(0.00025)

(0.00229)

(0.00164)

 

P-val

 

0.00005

 

0.90232

 

Bootstrap P-val

 

0.00000

 

0.91291

 

Exogeneity test P-val

  

0.540

0.386

Log earnings

coeff

–0.0269***

–0.0269***

–0.0947**

–0.0947***

 

se

(0.0033)

(0.0040)

(0.0447)

(0.0354)

 

P-val

 

2.78E-08

 

0.01051

 

Bootstrap P-val

 

0

 

0.03003

 

Exogeneity test P-val

   

0.0361

Log hours worked

coeff

–0.0203***

–0.0203***

–0.0666**

–0.0666***

 

se

(0.0024)

(0.0029)

(0.0326)

(0.0251)

 

P-val

 

1.05E-08

 

0.01105

 

Bootstrap P-val

 

0

 

0.03403

 

Exogeneity test P-val

   

0.0481

Panel B: Effect of the instrument from the first stage (OLS)

  

Outcome:

Standard errors:

Robust

Cluster (g*p)

  

Early non-empl.

Coeff

5.0319***

5.0319***

  
 

se

(1.6519)

(1.7139)

  
 

P-val

 

0.0053

  
 

Bootstrap P-val

 

0.0120

  
 

F stat

 

8.620

  
 

Bootstrap F stat e

 

5.84

  
  1. Standard errors between parentheses. Panel A reports results from estimating β in Eq. (2), excluding \(\overline {UR}_{p}\) and m i n U R pt . β is the effect of one pp increase in \(y^{0}_{it_{1}}\), i.e. the % of hours spent in non-employment at potential experience 0–2 relative to potential total hours if one would work full-time during the whole period. For clustered standard errors, we report the P-value and the wild bootstrap P-value. Column 1–2 (3–4) show OLS (2SLS). In 2SLS the provincial unemployment rate at graduation is used as instrument for \(y^{0}_{it_{1}}\!\). Panel B reports the effect of the instrument on \(y^{0}_{it_{1}}\) in the first stage and the corresponding F statistic
  2. ***p <0.01, **p <0.05, *p <0.1
  3. aRobust indicates heteroskedastic-robust standard errors. Clusters are defined by graduation year g and province of residence at graduation p (G =44 clusters)
  4. bThe outcomes are measured at potential experience 6. For continuous outcomes we add value one before taking the log, so that non-salaried employed at the moment of evaluation are included with outcomes equal to zero after the logarithmic transformation
  5. cComputed according to the wild bootstrap procedure proposed by Davidson and MacKinnon (2010) for 999 repetitions
  6. dWith clustered standard errors, this test is defined as the difference between two Sargan-Hansen statistics: one for the equation where \(y^{0}_{it_{1}}\) is treated as endogenous and one for the equation where \(y^{0}_{it_{1}}\) is treated as exogenous. Under the null that \(y^{0}_{it_{1}}\) is exogenous, the statistic is distributed as χ 2(1)
  7. eBootstrap F statistic is the F statistic corresponding to the Bootstrap P-value of the t statistic of the instrument: we rely on the equivalence between F and t distribution: with G=44, t 2(G−1)=F(1,G−1)
Back to article page