The evolving nature of the college wage premium

Oleksii Birulin, Vladimir Smirnov and Andrew Wait

Economic Modelling, 2020, vol. 93, issue C, 474-479

Abstract: Focusing on the signaling aspect of education, we show that the college wage premium can be U-shaped in the share of the population with a college degree. This prediction is consistent with empirical evidence from a range of countries. Moreover, the equilibrium in our model is unique, which means that we are able to generate empirically-testable predictions linking income inequality and the premium enjoyed by the college educated. Consequently, our model provides a framework for future empirical studies.

Keywords: College wage premium; Signaling; Education benefit (search for similar items in EconPapers)
JEL-codes: D82 I22 I28 J31 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:93:y:2020:i:c:p:474-479

DOI: 10.1016/j.econmod.2020.09.001

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