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Does a Bachelor's degree pay off? Labor market outcomes of academic versus vocational education after Bologna

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  • Neugebauer, Martin
  • Weiss, Felix

Abstract

Academic education is generally rewarded by employers, but what happens to graduates if they are trained for two years less and have to compete with vocationally trained labor market entrants in a similar field of study? Focusing on Germany, we analyze labor market entries of individuals eligible for higher education, who either opted for newly introduced short bachelor's degrees, or for well-established vocational degrees. Based on Microcensus data, we find that bachelor's degrees from classical universities are associated with higher earnings and more prestigious jobs than initial vocational training degrees, and with higher prestige (but similar earnings) than further vocational degrees. However, bachelor's degrees from universities are also related to higher risks of unemployment or fixed-term employment. Universities of applied sciences, which combine academic and practical training, offer both high earnings and prestigious jobs as well as low risks of unemployment or fixed-term employment at the bachelor's and the master's level. Overall, 'general' academic education provides advantages over vocational education, despite these structural changes. Variations by field of study are reported.

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  • Neugebauer, Martin & Weiss, Felix, 2017. "Does a Bachelor's degree pay off? Labor market outcomes of academic versus vocational education after Bologna," Discussion Papers 2017/11, Free University Berlin, School of Business & Economics.
    • Handle: RePEc:zbw:fubsbe:201711
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    Cited by:

    1. Frauke H. Peter & C. Katharina Spieß & Vaishali Zambre, 2018. "Informing Students about College: An Efficient Way to Decrease the Socio-Economic Gap in Enrollment: Evidence from a Randomized Field Experiment," Discussion Papers of DIW Berlin 1770, DIW Berlin, German Institute for Economic Research.
    2. Peter, Frauke & Spiess, C. Katharina & Zambre, Vaishali, 2021. "Informing students about college: Increasing enrollment using a behavioral intervention?," Journal of Economic Behavior & Organization, Elsevier, vol. 190(C), pages 524-549.

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    More about this item

    Keywords

    labor market outcomes; Bologna Process; vocational education; higher education; Germany;
    All these keywords.

    JEL classification:

    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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