Effects of mandatory military and alternative community service on wages and other socioeconomic outcomes

Abstract

In this paper, we estimate the effects of mandatory military and alternative community service by exploiting the post-cold war decrease in the need for soldiers causing a substantial number of potential conscripts not to be drafted into the German military. The study is based on retrospective survey information for 655 men from the 1970 to 1984 birth cohorts collected in 2009/10 and after, using previously unavailable information on degree of fitness in the military's medical exam as a control variable. We test for the effects of mandatory service on wages, employment, volunteer work, marriage/partnership status, and satisfaction with various aspects of life. Whilst many estimates are not statistically significant, for the younger birth cohorts 1976 to 1984, we find some evidence of a lower hourly wage due to mandatory military service, which shows a negative point estimate of −15% with a large confidence interval of between −30 and −0.2%. This interval estimate is consistent with previous findings for the United States, Denmark, and the Netherlands. However, we also find statistically significant estimates for both military and alternative community service to increase participation in volunteer work, a hitherto rarely explored effect.