Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/335943 
Year of Publication: 
2026
Series/Report no.: 
econ.GN
Publisher: 
arXiv, Ithaca, New York
Abstract: 
This paper studies how labor market conditions around high school graduation affect postsecondary skill investments. Using administrative data on more than six million German graduates from 1995-2018, and exploiting deviations from secular state-specific trends, I document procyclical college enrollment. Cyclical increases in unemployment reduce enrollment at traditional universities and shift graduates toward vocational colleges and apprenticeships. These effects translate into educational attainment. Using large-scale survey data, I identify changes in expected returns to different degrees as the main mechanism. During recessions, graduates expect lower returns to an academic degree, while expected returns to a vocational degree are stable.
Subjects: 
college enrollment
expectations
business cycles
apprenticeships
JEL: 
D84
E24
E32
I23
I24
I26
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Working Paper

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