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Education and Earnings Growth: Evidence from 11 European Countries

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Author Info
Brunello, Giorgio () (University of Padova and IZA, Bonn)
Comi, Simona (Fondazione Eni Enrico Mattei, Milan)

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Abstract

We use cohort data from 11 European countries to study whether experience profiles differ by educational attainment. Previous literature does not provide a clear answer to this question, that is important to evaluate private returns to education over the working life of individuals. We find evidence that employees with tertiary education have steeper experience profiles than employees with upper secondary or compulsory education. Hence, education provides not only an initial labor market advantage but also a permanent advantage that increases with time in the labor market. We also find that differences in earnings growth by education are lower in countries with a higher level of corporatism and higher in countries which have experienced both relatively fast labor productivity growth and a relatively low educational attainment. The educational system also seems to matter, because countries with a more stratified system of secondary education have smaller differences in earnings growth by education.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 140.

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Length: 30 pages
Date of creation: Apr 2000
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Handle: RePEc:iza:izadps:dp140

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Related research
Keywords: Education; earnings growth; Europe;

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Find related papers by JEL classification:
J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Richard B. Freeman & Robert S. Gibbons, 1995. "Getting Together and Breaking Apart: The Decline of Centralized Collective Bargaining," NBER Chapters, in: Differences and Changes in Wage Structures, pages 345-370 National Bureau of Economic Research, Inc. [Downloadable!]
    Other versions:
  2. Psacharopoulos, George & Layard, Richard, 1979. "Human Capital and Earnings: British Evidence and a Critique," Review of Economic Studies, Blackwell Publishing, vol. 46(3), pages 485-503, July. [Downloadable!] (restricted)
  3. Nickell, S. & Layard, R., 1997. "Labour Market Institutions and Economic Performance," Papers 23, Centre for Economic Performance & Institute of Economics.
    Other versions:
  4. David Card & Thomas Lemieux, 2000. "Can Falling Supply Explain the Rising Return to College for Younger Men? A Cohort-Based Analysis," NBER Working Papers 7655, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  5. Layard, Richard & Psacharopoulos, George, 1974. "The Screening Hypothesis and the Returns to Education," Journal of Political Economy, University of Chicago Press, vol. 82(5), pages 985-98, Sept./Oct. [Downloadable!] (restricted)
  6. Neuman, Shoshana & Weiss, Avi, 1995. "On the effects of schooling vintage on experience-earnings profiles: Theory and evidence," European Economic Review, Elsevier, vol. 39(5), pages 943-955, May. [Downloadable!] (restricted)
  7. Knight, J B & Sabot, R H, 1981. "The Returns to Education: Increasing with Experience or Decreasing with Expansion?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 43(1), pages 51-71, February.
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Muren, Astri & Nyberg, Sten, 2005. "Young Liberals and Old Conservatives - Inequality, Mobility and Redistribution," Research Papers in Economics 2005:9, Stockholm University, Department of Economics. [Downloadable!]
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  2. Angel de la Fuente & Juan Francisco Jimeno, 2004. "The private and fiscal returns to schooling and the effect of public policies on private incentives to invest in education: a general framework and some results for the EU," UFAE and IAE Working Papers 635.04, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC). [Downloadable!]
    Other versions:
  3. Hannu Piekkola, 2005. "Knowledge Capital as the Source of Growth," Discussion Papers 972, The Research Institute of the Finnish Economy. [Downloadable!]
  4. Elena Giarda, 2007. "The Worsening of Wage Expectations in Italy: a Study Based on Administrative data," LABORatorio R. Revelli Working Papers Series 57, LABORatorio R. Revelli, Centre for Employment Studies. [Downloadable!]
  5. Mihaela Pintea & Peter Thompson, 2005. "Technological Complexity and Economic Growth," Working Papers 0502, Florida International University, Department of Economics. [Downloadable!]
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  6. Joop Hartog & Hans van Ophem & Simona Maria Bajdechi, 2004. "How Risky is Investment in Human Capital?," Tinbergen Institute Discussion Papers 04-080/3, Tinbergen Institute. [Downloadable!]
  7. Semeijn,Judith, H. & Velden,Rolf,van der & Heijke,Hans & Vleuten,Cees,van der & Boshuizen,Henny, P.A., 2005. "Competence indicators in academic education and early labour market success of graduates in health sciences," Research Memoranda 003, Maastricht : ROA, Research Centre for Education and the Labour Market. [Downloadable!]
  8. Domeland, Dorte, 2007. "Trade and human capital accumulation: evidence from U.S. immigrants," Policy Research Working Paper Series 4144, The World Bank. [Downloadable!]
  9. Peter Thompson & Mihaela Pintea, 2005. "Technological Complexity, R&D and Education: Some Pleasant Arithmetic," Computing in Economics and Finance 2005 185, Society for Computational Economics. [Downloadable!]
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