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The wage premium from parents’ investments in the education of their children in Poland

Author

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  • Emilia Bedyk

    (Faculty of Economic Sciences, University of Warsaw)

  • Jacek Liwiński

    (Faculty of Economic Sciences, University of Warsaw)

Abstract

The aim of this paper is to determine whether parents’ investments in the education of children in Poland have an impact on the wages of the latter in adulthood. To answer this question, an extended Mincer wage equation was estimated using OLS on the basis of data from the nationwide tracer survey of Polish graduates conducted in 2007. The results of the analysis show that parents’ investments in the education of their children have a strong, positive impact on the first earnings after the end of formal education. This relationship is observed when the investment is depicted with the education level of each parent, as well as when represented by the child’s participation in various extra-curricular activities. Furthermore, if any of the above measures of parents’ investment is included in the equation, the wage premium from formal education decreases. In particular, when both these measures of parents’ investments are included in the model, the tertiary education premium declines by about one quarter, while the secondary vocational education and secondary general education are no longer significant determinants of the graduates’ wages (as compared to basic vocational education).

Suggested Citation

  • Emilia Bedyk & Jacek Liwiński, 2016. "The wage premium from parents’ investments in the education of their children in Poland," Working Papers 2016-14, Faculty of Economic Sciences, University of Warsaw.
  • Handle: RePEc:war:wpaper:2016-14
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    File URL: http://www.wne.uw.edu.pl/index.php/download_file/2732/
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    More about this item

    Keywords

    investment in human capital; formal education; extra-curricular activities; wage premium; wage equation;
    All these keywords.

    JEL classification:

    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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