TY  - RPRT
        AU  - Borgschulte, Mark
AU  - Martorell, Paco
        TI  - Paying to Avoid Recession: Using Reenlistment to Estimate the Cost of Unemployment
        PY  - 2016/Jan/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 9680
        UR  - https://www.iza.org/publications/dp9680
        AB  - This paper provides revealed-preference estimates of the monetary value of avoiding job search in a high-unemployment labor market by examining the behavior of military servicemembers deciding between reenlisting and exiting the military. We find that servicemembers would sacrifice 1.5-2% in earnings in exchange for avoiding a one percentage point increase in the home-state unemployment rate. Comparing these estimates to realized losses in post-service civilian earnings resulting from exiting the military during times of high unemployment suggests that mitigating factors (e.g., leisure, private and public transfers) offset less than one-third of the earnings losses caused by entering a weak labor market.
        KW  - labor market entry
KW  - welfare cost of business cycles
KW  - military reenlistment
        ER  -