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Variations in the Wage Returns to a First Degree: Evidence from the British Cohort Study 1970

Author

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  • Bratti, Massimiliano

    () (University of Milan)

  • Naylor, Robin

    () (University of Warwick)

  • Smith, Jeremy

    () (University of Warwick)

Abstract

As in many other countries, government policy in the UK has the objective of raising the participation rate of young people in higher education, while increasing the share of the costs of higher education paid by students themselves. A rationale for the latter element comes from evidence of a high private return to university undergraduate degrees. However, much of this evidence pre-dates the rapid expansion in the graduate population. In the current paper, we use evidence from a cohort of young people born in Britain in 1970 to update influential evidence on returns to a first degree based on a previous 1958 birth cohort. We also analyse variations in returns by degree subject and by class of degree. Our analysis incorporates proxying and matching, control function and propensity score matching methods. Among other results, we find (i) that the returns to a first degree for men changed very little across the two cohorts while the return for women declined substantially and (ii) evidence of differences in returns to a first degree according to subject area of study and class of degree awarded.

Suggested Citation

  • Bratti, Massimiliano & Naylor, Robin & Smith, Jeremy, 2005. "Variations in the Wage Returns to a First Degree: Evidence from the British Cohort Study 1970," IZA Discussion Papers 1631, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp1631
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    References listed on IDEAS

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    Cited by:

    1. Jack Britton & Neil Shephard & Anna Vignoles, 2015. "Comparing sample survey measures of English earnings of graduates with administrative data during the Great Recession," IFS Working Papers W15/28, Institute for Fiscal Studies.
    2. Chevalier, Arnaud, 2011. "Subject choice and earnings of UK graduates," Economics of Education Review, Elsevier, vol. 30(6), pages 1187-1201.
    3. Lindsey Macmillan & Claire Tyler & Anna Vignoles, 2013. "Who gets the Top Jobs? The role of family background and networks in recent graduates' access to high status professions," DoQSS Working Papers 13-15, Department of Quantitative Social Science - UCL Institute of Education, University College London.
    4. 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.
    5. Broecke, Stijn & Nicholls, Tom, 2007. "Ethnicity and degree attainment," MPRA Paper 35284, University Library of Munich, Germany.

    More about this item

    Keywords

    degree; return; subject; class; UK; university;

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J4 - Labor and Demographic Economics - - Particular Labor Markets
    • I2 - Health, Education, and Welfare - - Education

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