IDEAS home Printed from https://ideas.repec.org/a/spr/jlabrs/v55y2021i1d10.1186_s12651-021-00301-4.html
   My bibliography  Save this article

Place of study, field of study and labour-market region: What matters for wage differences among higher-education graduates?

Author

Listed:
  • Silvia Kopecny

    (University of Tübingen)

  • Steffen Hillmert

    (University of Tübingen)

Abstract

This paper focuses on the structure and extent of wage differences among graduates of different higher-education institutions in Germany. We ask how large these differences are and how they relate to fields of study and regional labour markets. The results from our application of cross-classified random-effects models to a cohort of the DZHW Graduate Panel show that there is a considerable amount of wage variation depending on the graduates’ alma mater. However, this variation can be fully explained by structural characteristics: Selection based on individual characteristics is of only minor importance, while regional labour markets do matter. Most of all, however, the differences relate to fields of study.

Suggested Citation

  • Silvia Kopecny & Steffen Hillmert, 2021. "Place of study, field of study and labour-market region: What matters for wage differences among higher-education graduates?," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 55(1), pages 1-21, December.
    • Handle: RePEc:spr:jlabrs:v:55:y:2021:i:1:d:10.1186_s12651-021-00301-4
    DOI: 10.1186/s12651-021-00301-4
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1186/s12651-021-00301-4
    File Function: Abstract
    Download Restriction: no
    File URL: https://libkey.io/10.1186/s12651-021-00301-4?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Suhonen, Tuomo, 2013. "Are there returns from university location in a state-funded university system?," Regional Science and Urban Economics, Elsevier, vol. 43(3), pages 465-478.
    2. Kratz, Fabian & Brüderl, Josef, 2013. "Returns to Regional Migration: Causal Effect or Selection on Wage Growth?," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 133(2), pages 227-238.
    3. Massimo Anelli, 2020. "The Returns to Elite University Education: a Quasi-Experimental Analysis," Journal of the European Economic Association, European Economic Association, vol. 18(6), pages 2824-2868.
    4. Daniela Glocker & Johanna Storck, 2012. "Uni, Fachhochschule oder Ausbildung - welche Fächer bringen die höchsten Löhne?," DIW Wochenbericht, DIW Berlin, German Institute for Economic Research, vol. 79(13), pages 3-8.
    5. Holmlund, Linda, 2009. "The Effect of College Quality on Earnings Evidence from Sweden," Umeå Economic Studies 781, Umeå University, Department of Economics.
    6. Barbara S. Grave & Katja Goerlitz, 2012. "Wage differentials by field of study -- the case of German university graduates," Education Economics, Taylor & Francis Journals, vol. 20(3), pages 284-302, March.
    7. Arnaud Chevalier, 2014. "Does Higher Education Quality Matter in the UK?," Research in Labor Economics, in: Factors Affecting Worker Well-being: The Impact of Change in the Labor Market, volume 40, pages 257-292, Emerald Group Publishing Limited.
    8. Yulia Marchenko, 2006. "Estimating variance components in Stata," Stata Journal, StataCorp LP, vol. 6(1), pages 1-21, March.
    9. Stefan Krabel & Choni Fl�ther, 2014. "Here Today, Gone Tomorrow? Regional Labour Mobility of German University Graduates," Regional Studies, Taylor & Francis Journals, vol. 48(10), pages 1609-1627, October.
    10. Joachim Ragnitz, 2012. "Regionale Lohnunterschiede in Deutschland," ifo Dresden berichtet, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 19(02), pages 26-32, April.
    11. Black Dan & Daniel Kermit & Smith Jeffrey, 2005. "College Quality and Wages in the United States," German Economic Review, De Gruyter, vol. 6(3), pages 415-443, August.
    12. Cunha, Jesse M. & Miller, Trey, 2014. "Measuring value-added in higher education: Possibilities and limitations in the use of administrative data," Economics of Education Review, Elsevier, vol. 42(C), pages 64-77.
    13. Gary S. Becker, 1994. "Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, Third Edition," NBER Books, National Bureau of Economic Research, Inc, number beck94-1, March.
    14. Stacy Berg Dale & Alan B. Krueger, 2002. "Estimating the Payoff to Attending a More Selective College: An Application of Selection on Observables and Unobservables," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(4), pages 1491-1527.
    15. Alessandra Faggian & Philip McCann & Stephen Sheppard, 2007. "Human Capital, Higher Education and Graduate Migration: An Analysis of Scottish and Welsh Students," Urban Studies, Urban Studies Journal Limited, vol. 44(13), pages 2511-2528, December.
    16. Sophia Rabe-Hesketh & Anders Skrondal, 2012. "Multilevel and Longitudinal Modeling Using Stata, 3rd Edition," Stata Press books, StataCorp LP, edition 3, number mimus2, March.
    17. Monks, James, 2000. "The returns to individual and college characteristics: Evidence from the National Longitudinal Survey of Youth," Economics of Education Review, Elsevier, vol. 19(3), pages 279-289, June.
    18. Jack Britton & Lorraine Dearden & Neil Shephard & Anna Vignoles, 2016. "How English domiciled graduate earnings vary with gender, institution attended, subject and socio-economic background," IFS Working Papers W16/06, Institute for Fiscal Studies.
    19. Buch, Tanja & Hamann, Silke & Niebuhr, Annekatrin & Rossen, Anja, 2014. "How to woo the smart ones? Evaluating the determinants that particularly attract highly qualified people to cities," HWWI Research Papers 159, Hamburg Institute of International Economics (HWWI).
    20. Massimo Anelli, 0. "The Returns to Elite University Education: a Quasi-Experimental Analysis," Journal of the European Economic Association, European Economic Association, vol. 18(6), pages 2824-2868.
    21. Dominic J. Brewer & Eric R. Eide & Ronald G. Ehrenberg, 1999. "Does It Pay to Attend an Elite Private College? Cross-Cohort Evidence on the Effects of College Type on Earnings," Journal of Human Resources, University of Wisconsin Press, vol. 34(1), pages 104-123.
    22. repec:zbw:rwirep:0316 is not listed on IDEAS
    23. Mark Hoekstra, 2009. "The Effect of Attending the Flagship State University on Earnings: A Discontinuity-Based Approach," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 717-724, November.
    24. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(3), pages 355-374.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yanming Li & Kangyin Lu & Kaiyuan Wang, 2021. "Inequality in the Initial Wage of College Graduates at the College-Level Perspective," Sustainability, MDPI, vol. 13(24), pages 1-15, December.
    2. Venera Timiryanova & Dina Krasnoselskaya & Natalia Kuzminykh, 2022. "Applying the Multilevel Approach in Estimation of Income Population Differences," Stats, MDPI, vol. 6(1), pages 1-32, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:iab:iabjlr:v:55:i::p:art.19 is not listed on IDEAS
    2. Kopecny, Silvia & Hillmert, Steffen, 2021. "Place of study, field of study and labour-market region: What matters for wage differences among higher-education graduates?," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 55, pages 1-19.
    3. Britton, Jack & van der Erve, Laura & Belfield, Chris & Vignoles, Anna & Dickson, Matt & Zhu, Yu & Walker, Ian & Dearden, Lorraine & Sibieta, Luke & Buscha, Franz, 2022. "How much does degree choice matter?," Labour Economics, Elsevier, vol. 79(C).
    4. Eliasson, Kent, 2006. "The Role of Ability in Estimating the Returns to College Choice: New Swedish Evidence," Umeå Economic Studies 691, Umeå University, Department of Economics.
    5. David Carroll & Chris Heaton & Massimiliano Tani, 2019. "Does It Pay to Graduate from an 'Elite' University in Australia?," The Economic Record, The Economic Society of Australia, vol. 95(310), pages 343-357, September.
    6. Hinrichs, Peter, 2014. "Affirmative action bans and college graduation rates," Economics of Education Review, Elsevier, vol. 42(C), pages 43-52.
    7. Suhonen, Tuomo, 2013. "Are there returns from university location in a state-funded university system?," Regional Science and Urban Economics, Elsevier, vol. 43(3), pages 465-478.
    8. Jack Mountjoy & Brent Hickman, 2020. "The Returns to College(s): Estimating Value-Added and Match Effects in Higher Education," Working Papers 2020-08, Becker Friedman Institute for Research In Economics.
    9. Milla, Joniada, 2017. "The Context-Bound University Selectivity Premium," IZA Discussion Papers 11025, Institute of Labor Economics (IZA).
    10. Broecke, Stijn, 2012. "University selectivity and earnings: Evidence from UK data on applications and admissions to university," Economics of Education Review, Elsevier, vol. 31(3), pages 96-107.
    11. Carroll, David & Heaton, Christopher & Tani, Massimiliano, 2014. "Returns to University Quality in Australia: A Two-Stage Analysis," IZA Discussion Papers 8473, Institute of Labor Economics (IZA).
    12. Leah Achdut & Elad Gutman & Idan Lipiner & Inbal Maayan & Noam Zussman, 2018. "The Wage Premium on Higher Education: Universities and Colleges," Bank of Israel Working Papers 2018.13, Bank of Israel.
    13. Tuomo Suhonen, 2014. "Quality of higher education and earnings: evidence from Finland using field-of-study-level quality measures," International Review of Applied Economics, Taylor & Francis Journals, vol. 28(1), pages 22-44, January.
    14. Bacalhau, Priscilla & Mattos, Enlinson & Ponczek, Vladimir Pinheiro, 2019. "College quality signaling and individual performance: effects on labor market outcomes after graduation," Textos para discussão 502, FGV EESP - Escola de Economia de São Paulo, Fundação Getulio Vargas (Brazil).
    15. Andrews, Rodney J. & Imberman, Scott A. & Lovenheim, Michael F., 2020. "Recruiting and supporting low-income, high-achieving students at flagship universities," Economics of Education Review, Elsevier, vol. 74(C).
    16. Long, Mark C., 2010. "Changes in the returns to education and college quality," Economics of Education Review, Elsevier, vol. 29(3), pages 338-347, June.
    17. Zara Daghbashyan & Björn Hårsman, 2014. "University choice and entrepreneurship," Small Business Economics, Springer, vol. 42(4), pages 729-746, April.
    18. Eliasson, Kent, 2006. "How Robust is the Evidence on the Returns to College Choice? Results Using Swedish Administrative Data," Umeå Economic Studies 692, Umeå University, Department of Economics.
    19. Amanda L. Griffith & Kevin N. Rask, 2016. "The Effect Of Institutional Expenditures On Employment Outcomes And Earnings," Economic Inquiry, Western Economic Association International, vol. 54(4), pages 1931-1945, October.
    20. Toby J. Park & Stella M. Flores & Christopher J. Ryan, 2018. "Labor Market Returns for Graduates of Hispanic-Serving Institutions," Research in Higher Education, Springer;Association for Institutional Research, vol. 59(1), pages 29-53, February.
    21. Justine S. Hastings & Christopher A. Neilson & Seth D. Zimmerman, 2013. "Are Some Degrees Worth More than Others? Evidence from college admission cutoffs in Chile," NBER Working Papers 19241, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    Wages; Higher-education institution; Fields of study; Regional labour markets; Multi-level analysis;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:jlabrs:v:55:y:2021:i:1:d:10.1186_s12651-021-00301-4. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.