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Rates of Return to Degrees across British Regions

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  • O'Leary, Nigel C.

    (Swansea University)

  • Sloane, Peter J.

    (Swansea University)

Abstract

Earlier papers have found considerable heterogeneity in the returns to degrees in relation to subjects of study, degree classification and higher education institution. In this paper we examine heterogeneity of returns across British regions using the Labour Force Survey. We find substantial variations in the financial rewards available to graduates across regions with much higher returns in London and the South East than elsewhere, although adjusting for regional differences in the cost-of-living narrows such differences considerably. Decompositional analysis, after controlling for regional differences in both occupational and industrial structures, suggests that coefficient effects dominate composition effects, consistent with agglomeration effects being important. These results have implications for the recent changes to student funding in England, Scotland and Wales.

Suggested Citation

  • O'Leary, Nigel C. & Sloane, Peter J., 2006. "Rates of Return to Degrees across British Regions," IZA Discussion Papers 1947, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp1947
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    References listed on IDEAS

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    6. O'Leary, Nigel C. & Sloane, Peter J., 2005. "The Return to a University Education in Great Britain," National Institute Economic Review, National Institute of Economic and Social Research, vol. 193, pages 75-89, July.
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    9. H. Battu & C. R. Belfield & P. J. Sloane, 1999. "Overeducation Among Graduates: a cohort view," Education Economics, Taylor & Francis Journals, vol. 7(1), pages 21-38.
    10. Lorraine Dearden, 1999. "Qualifications and earnings in Britain: how reliable are conventional OLS estimates of the returns to education?," IFS Working Papers W99/07, Institute for Fiscal Studies.
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    12. Yiannis KAMARIANAKIS (IACM and University of Crete) & Julie Le GALLO (GRES- IFReDE-IERSO), 2003. "The evolution of regional productivity disparities in the European Union, 1975-2000," Cahiers du GRES (2002-2009) 2003-15, Groupement de Recherches Economiques et Sociales.
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    Cited by:

    1. Cinzia Rienzo, 2017. "Real wages, wage inequality and the regional cost-of-living in the UK," Empirical Economics, Springer, vol. 52(4), pages 1309-1335, June.
    2. Kristinn Hermannsson & Katerina Lisenkova & Patrizio Lecca & Peter McGregor & Kim Swales, 2010. "The Importance of Graduates for the Scottish Economy: A "Micro-to-Macro" Approach," Working Papers 1026, University of Strathclyde Business School, Department of Economics.
    3. Vani Borooah & John Mangan, 2008. "Education, occupational class, and unemployment in the regions of the United Kingdom," Education Economics, Taylor & Francis Journals, vol. 16(4), pages 351-370.
    4. Adriana Duta & Cristina Iannelli, 2018. "Social Class Inequalities in Graduates’ Labour Market Outcomes: The Role of Spatial Job Opportunities," Social Sciences, MDPI, vol. 7(10), pages 1-18, October.
    5. Pamela Lenton, 2011. "Part time employment and happiness: A cross-country analysis," Working Papers 2011001, The University of Sheffield, Department of Economics, revised Jan 2011.
    6. Kidd, Michael & O'Leary, Nigel C. & Sloane, Peter J., 2014. "Should I Stay or Should I Go? An Investigation of Graduate Regional Mobility in the UK and its Impact upon Early Career Earnings," IZA Discussion Papers 8325, Institute of Labor Economics (IZA).
    7. Kidd, Michael P. & O'Leary, Nigel & Sloane, Peter, 2017. "The impact of mobility on early career earnings: A quantile regression approach for UK graduates," Economic Modelling, Elsevier, vol. 62(C), pages 90-102.

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    More about this item

    Keywords

    education; degree; rates of return; regions;
    All these keywords.

    JEL classification:

    • A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
    • A23 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Graduate
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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