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Educational Qualifications and Wage Inequality: Evidence for Europe

Santiago Budria Rodriguez () and Pedro Pereira

No 1763, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper explores the connection between education and wage inequality in nine European countries. We exploit the quantile regression technique to calculate returns to lower secondary, upper secondary and tertiary education at different points of the wage distribution. We find that returns to tertiary education are highly increasing when moving from the lower to the upper quantiles. This finding suggests that an educational expansion towards tertiary education is expected, ceteris paribus, to increase overall wage inequality through the withindimension. Returns to secondary education are more homogeneous across quantiles, thus suggesting that an educational expansion towards secondary education is expected to have a more limited impact on within-groups dispersion. Using data from the last decades, we assess how the impact of education on wage inequality has evolved over time. We detect different trends across countries. A common feature is that the inequality increasing effect of tertiary education became more acute over the last years.

Keywords: wage inequality; quantile regression; returns to education (search for similar items in EconPapers)
JEL-codes: C29 D31 I21 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2005-09
New Economics Papers: this item is included in nep-edu, nep-eec, nep-lab and nep-ltv
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Citations: View citations in EconPapers (23) Track citations by RSS feed

Published in: Revista de Economía Aplicada, 2011, 56 (19), 5-34

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Related works:
Journal Article: EDUCATIONAL QUALIFICATIONS AND WAGE INEQUALITY: EVIDENCE FOR EUROPE (2011) Downloads
Working Paper: Educational Qualifications and Wage Inequality: Evidence for Europe (2005) Downloads
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