Abstract
In this paper I analyse whether non-employment periods at the initial stages of an individual’s career may increase workers’ propensity to experience non-employment also in subsequent years. The study is based on data on young individuals in Italy. The paper uses an instrumental variables approach to separate the effect of early non-employment from any residual unobserved heterogeneity. The results provide strong evidence of negative effects induced by early non-employment, but the size of these effects depends on individual and regional labour market characteristics. The negative repercussions of early non-employment are smaller during economic downturns or in regions with high unemployment rates.
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