Variations in the Wage Returns to a First Degree: Evidence from the British Cohort Study 1970
Massimiliano Bratti, University of Milan
Robin Naylor, University of Warwick
Jeremy Smith, University of Warwick
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ABSTRACT:
As in many other countries, government policy in the UK has the objective
of raising the participation rate of young people in higher education,
while increasing the share of the costs of higher education paid by students
themselves. A rationale for the latter element comes from evidence of a high
private return to university undergraduate degrees. However, much of this
evidence pre-dates the rapid expansion in the graduate population. In the
current paper, we use evidence from a cohort of young people born in Britain
in 1970 to update influential evidence on returns to a first degree based on
a previous 1958 birth cohort. We also analyse variations in returns by degree
subject and by class of degree. Our analysis incorporates proxying and
matching, control function and propensity score matching methods. Among
other results, we find (i) that the returns to a first degree for men changed
very little across the two cohorts while the return for women declined substantially
and (ii) evidence of differences in returns to a first degree according
to subject area of study and class of degree awarded.
SUBJECT AREA:
J3, J4, I2
SUGGESTED CITATION:
Massimiliano Bratti, Robin Naylor, and Jeremy Smith,
"Variations in the Wage Returns to a First Degree: Evidence from the British Cohort Study 1970"
(June 2005).
UNIMI - Research Papers in Economics, Business, and Statistics.
Economics.
Working Paper 3.
http://services.bepress.com/unimi/economics/art3
Paper presented by Marzio Galeotti.
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