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Estimating wage equations for Hungarian higher-education graduates

Author

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  • Peter Galasi

    () (Budapest University of Economics and Public Administration)

Abstract

The paper investigates the wage determination of Hungarian highereducation graduates with using two samples of Hungarian careerbeginners, applying IV techniques and the multiple indicator solution so as to diminish potential estimation biases due to endogeneity of independent variables (especially the education variable) and the simultaneity of wages and working time. The results show that university education yields considerable wage premium as compared to college education, and that the return to education would be significantly underestimated by ols. The estimates confirm that foreign-language and IT knowledge also produce advantages in terms of wages.

Suggested Citation

  • Peter Galasi, 2003. "Estimating wage equations for Hungarian higher-education graduates," Budapest Working Papers on the Labour Market 0304, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
  • Handle: RePEc:has:bworkp:0304
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    File URL: http://www.econ.core.hu/doc/bwp/bwp/bwp0304.pdf
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    References listed on IDEAS

    as
    1. Péter Galasi & Júlia Varga, 2002. "Does Private and Cost-Priced Higher Education Produce Poor Quality?," Society and Economy, Akadémiai Kiadó, Hungary, vol. 24(3), pages 333-361, December.
    2. Kertesi, Gábor & Köllő, János, 1997. "Reálbérek és kereseti egyenlőtlenségek, 1986-1996. A bérszerkezet átalakulása Magyarországon, I. rész
      [Real wages and earning inequalities, 1986-1996. Part I. The transformation of wage structure i
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 612-634.
    3. Callan, Tim & Harmon, Colm, 1999. "The economic return to schooling in Ireland," Labour Economics, Elsevier, vol. 6(4), pages 543-550, November.
    4. Jennifer Hunt, 2002. "The Transition in East Germany: When Is a Ten-Point Fall in the Gender Wage Gap Bad News?," Journal of Labor Economics, University of Chicago Press, vol. 20(1), pages 148-169, January.
    5. Trostel, Philip & Walker, Ian & Woolley, Paul, 2002. "Estimates of the economic return to schooling for 28 countries," Labour Economics, Elsevier, vol. 9(1), pages 1-16, February.
    6. Bound, John & Solon, Gary, 1999. "Double trouble: on the value of twins-based estimation of the return to schooling," Economics of Education Review, Elsevier, vol. 18(2), pages 169-182, April.
    7. Light, Audrey, 2001. "In-School Work Experience and the Returns to Schooling," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 65-93, January.
    8. Brunello, Giorgio & Miniaci, Raffaele, 1999. "The economic returns to schooling for Italian men. An evaluation based on instrumental variables1," Labour Economics, Elsevier, vol. 6(4), pages 509-519, November.
    9. van Smoorenburg, M. S. M. & van der Velden, R. K. W., 2000. "The training of school-leavers: Complementarity or substitution?," Economics of Education Review, Elsevier, vol. 19(2), pages 207-217, April.
    10. Filer, Randall K. & Jurajda, Stepan & Planovsky, Jan, 1999. "Education and wages in the Czech and Slovak Republics during transition," Labour Economics, Elsevier, vol. 6(4), pages 581-593, November.
    11. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", pages 129-137.
    12. Card, David, 2001. "Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems," Econometrica, Econometric Society, vol. 69(5), pages 1127-1160, September.
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    Cited by:

    1. Szilvia Hamori, 2005. "Comparative analysis of the returns to education in Germany and Hungary (2000)," Budapest Working Papers on the Labour Market 0507, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
    2. Judit Kontseková, 2008. "Die Verzinsung von Ausbildung in drei benachbarten Transformationsländern und Österreich," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 34(1), pages 83-104.

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