The College Wage Premium over Time: Trends in Europe in the Last 15 Years☆

Elena Crivellaro

A chapter in Inequality: Causes and Consequences, 2016, vol. 43, pp 287-328 from Emerald Group Publishing Limited

Abstract: While there has been intense debate in the empirical literature over the evolution of the college wage premium in the United States, its evolution in Europe has received little attention. This paper investigates the causes of the evolution of the college wage premium in 12 European countries from 1994 to 2009, assessing the relevance of the supply factor as a determinant of the college wage premium. I use cross-country variation in relative supply, demand, and labour market institutions to examine their effects on the trend in wage inequality. I address possible concerns of endogeneity of the relative supply using an IV strategy exploiting the differential legislations of university autonomy and their variations over time. Results show that the strong increase in the relative supply that European countries have experienced has decreased the college wage premium. The most relevant institution is the minimun wage, which significantly decreases college wage premium.

Keywords: College wage premium; inequality; relative supply; J24; J31; I24 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:rleczz:s0147-912120160000043016

DOI: 10.1108/S0147-912120160000043016

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