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A question of degree: the effects of degree class on labor market outcomes

  • Andy Feng
  • Georg Graetz

In this paper we estimate the sorting effects of university degree class on initial labor market outcomes using a regression discontinuity design that exploits institutional rules governing the award of degrees. Consistent with anecdotal evidence, we find sizeable and significant effects for Upper Second degrees and positive but smaller effects for First Class degrees on wages. In additional results we explore differences across groups and find evidence consistent with a simple model of statistical discrimination on the basis of gender and types of degree programmes. When we split the sample by ability, we find that the signaling effects are similar in the high ability group but stronger for Upper Second degrees in the lower ability group. The evidence points to the importance of sorting in the high skills labor market.

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File URL: http://eprints.lse.ac.uk/51562/
File Function: Open access version.
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Paper provided by London School of Economics and Political Science, LSE Library in its series LSE Research Online Documents on Economics with number 51562.

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Length: 48 pages
Date of creation: 2013
Date of revision:
Handle: RePEc:ehl:lserod:51562
Contact details of provider: Postal: LSE Library Portugal Street London, WC2A 2HD, U.K.
Phone: +44 (020) 7405 7686
Web page: http://www.lse.ac.uk/

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