A Question of Honor? The Labor Market Advantage of Academic Signaling

Mael Astruc--Le Souder, Olivier Bargain and Gedeao Locks
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Mael Astruc--Le Souder: Bordeaux University
Gedeao Locks: DIW, Berlin

No 18567, IZA Discussion Papers from IZA Network @ LISER

Abstract: As tertiary education expands, employers increasingly rely on academic distinctions to screen among similarly qualified graduates. We study the labor-market effects of honors using administrative and survey data on Sorbonne master's graduates. We exploit France's fixed GPA thresholds for honors assignment to implement a fuzzy regression discontinuity design. Returns are concentrated at the intermediate distinction ("High Honors"), indicating that credentials are most informative when they separate above- from below-average students. We find that High Honors accelerate school-to-work transitions, increasing the monthly job-finding rate by about 40%. Honors also generate an initial wage premium, which fades within two years, and lead to persistent improvements in job quality, including greater access to master's-level positions and faster transitions to permanent contracts. These results highlight the role of academic distinctions as short-run signals that shape early career allocation rather than long-term earnings.

Keywords: signaling; honors; regression discontinuity design; fuzzy RDD (search for similar items in EconPapers)
JEL-codes: I23 I28 J23 J24 J31 (search for similar items in EconPapers)
Date: 2026-04
New Economics Papers: this item is included in nep-edu and nep-lma
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