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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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Author Info
Joop Hartog () (University of Amsterdam)
Pedro T. Pereira (Universidade Nova de Lisboa)
José A.C. Vieira () (Universidade dos Azores)

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Abstract

This paper examines the evolution of the returns to education in Portugal over the 1980s and early 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 an increase in the level of education within the labour force, the process is most likely demand driven. The results also indicate that modelling on average (i.e. OLS) misses important features of the wage structure. Quantile regression (QR) analysis reveals that the effect of education is not constant across the conditional wage distribution. They are higher for those at higher quantiles in the conditional wage distribution. Wage inequality expanded in Portugal over the 1980s and the returns to education had an important role in this process.

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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. repec:fth:prinin:331 is not listed on IDEAS
  2. 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. [Downloadable!] (restricted)
  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. [Downloadable!] (restricted)
  4. 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. [Downloadable!] (restricted)
  5. David Card, 1994. "Earnings, Schooling, and Ability Revisited," NBER Working Papers 4832, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  1. Budria, Santiago & Telhado-Pereira, Pedro, 2005. "Educational Qualifications and Wage Inequality: Evidence for Europe," MPRA Paper 91, University Library of Munich, Germany. [Downloadable!]
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