Do International Study Programmes Pay off for Local Students?

Zhiling Wang (), Francesco Pastore, Bas Karreman () and Frank Oort
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Zhiling Wang: Erasmus University Rotterdam
Bas Karreman: Erasmus University Rotterdam

No 14374, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: International study programmes are increasing in number worldwide, but little is known about the impact on local students' job prospects, especially in a non-English speaking countries. Using rich administrative data from Statistics Netherlands, we analyse labour market outcomes of native graduates in master programmes of Dutch universities between 2006 to 2014 within 5 years after graduation. A coarsened exact matching analysis within cohort-university-detailed field of study group addresses the self-selection issue by generating a matched sample of students with similar characteristics. We find that graduates from international programmmes obtain a wage premium of 2.3% starting from the 1st year after graduation, ceteris paribus. The wage premium keeps increasing by about 1% every year. We investigate the mechanisms through which the wage premium operates. The wage premia can neither be explained by wage increase via cross-firm mobility, nor by faster upward mobility within a firm. Instead, evidence point towards the differential characteristics of the first job upon graduation. Graduates from international programmes are much more likely to choose large firms that have a higher share of foreign-born employees and have business of trade for the first job. They get a head start in wage level and the initial wage advantages persist in the long-run.

Keywords: international programme; native students; wage premium; coarsened exact matching (search for similar items in EconPapers)
JEL-codes: F22 I23 J24 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2021-05
New Economics Papers: this item is included in nep-edu, nep-eur and nep-lma
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Working Paper: Do International Study Programmes Pay off for Local Students? (2021)
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