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Changing Returns to Education in Portugal during the 1980s and Early 1990s: OLS and quantile regression estimators

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  • Joop Hartog

    ()
    (University of Amsterdam)

  • Pedro T. Pereira

    (Universidade Nova de Lisboa)

  • José A.C. Vieira

    ()
    (Universidade dos Azores)

Abstract

This paper examines the evolution of the returns to education in Portugal over the 1980s andearly 1990s. The main findings indicate that the returns to education have increased,particularly after joining the European Union in 1986. Since this occurred along with anincrease in the level of education within the labour force, the process is most likely demanddriven. The results also indicate that modelling on average (i.e. OLS) misses importantfeatures of the wage structure. Quantile regression (QR) analysis reveals that the effect ofeducation is not constant across the conditional wage distribution. They are higher for thoseat higher quantiles in the conditional wage distribution. Wage inequality expanded inPortugal over the 1980s and the returns to education had an important role in this process.

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Bibliographic Info

Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 99-002/3.

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Date of creation: 21 Jan 1999
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Handle: RePEc:dgr:uvatin:19990002

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  1. David Card, 1994. "Earnings, Schooling, and Ability Revisited," NBER Working Papers 4832, National Bureau of Economic Research, Inc.
  2. Berman, Eli & Bound, John & Griliches, Zvi, 1994. "Changes in the Demand for Skilled Labor within U.S. Manufacturing: Evidence from the Annual Survey of Manufactures," The Quarterly Journal of Economics, MIT Press, vol. 109(2), pages 367-97, May.
  3. Duncan, Greg J. & Hoffman, Saul D., 1981. "The incidence and wage effects of overeducation," Economics of Education Review, Elsevier, vol. 1(1), pages 75-86, February.
  4. Buchinsky, Moshe, 1995. "Quantile regression, Box-Cox transformation model, and the U.S. wage structure, 1963-1987," Journal of Econometrics, Elsevier, vol. 65(1), pages 109-154, January.
  5. Courakis, Anthony S, 1991. "Labour Skills and Human Capital in the Explanation of Trade Patterns," Oxford Economic Papers, Oxford University Press, vol. 43(3), pages 443-62, July.
  6. Cardoso, Ana Rute, 1998. "Earnings Inequality in Portugal: High and Rising?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 44(3), pages 325-43, September.
  7. repec:fth:prinin:331 is not listed on IDEAS
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