Scars of Youth Non-employment and Labour Market Conditions

In this paper I analyse whether non-employment periods at the initial stage of work career may increase propensity to experience in subsequent years too, using data on young individuals Italy. The role labour market conditions moderating these scarring effects is investigated, exploiting regional differences across country. results provide evidence negative induced by early non-employment. Moreover, repercussions are smaller (higher) regions with higher (lower) unemployment rates. This can be interpreted signaling theory.