Even education has its limits: closing the wage gap
Abstract
Purpose
Economic outcomes are compared for university graduates in Israel belonging to four different ethnic groups. A unique data set is used that includes all individuals who graduated with a first degree from universities and colleges in Israel between the years 1995 and 2008 and which tracks them for up to ten years from the year they graduated. The main finding is that education and experience appear to have a strong effect on earnings in the long run and that an ethnic group can improve its position relative to certain groups while there is no effect relative to other groups. The paper aims to discuss these issues.
Design/methodology/approach
The authors consider three of the main factors determining the success of assimilation: size of the ethnic group; cultural differences between groups and skin color; and examine how these factors affect economic outcomes. The authors use a unique data set that includes all individuals who graduated with a first degree from universities and colleges in Israel between the years 1995 and 2008.
Findings
The results obtained in this study show that on average native Jews attain the best economic outcomes, followed by FSU immigrants, Israeli Arabs and finally Ethiopian immigrants. Education and experience appear to have a strong effect on earnings in the long run. An ethnic group can improve its position relative to other groups as they accumulate work experience.
Originality/value
This is the first time that the Ethiopian immigrants where taken into account.
Keywords
Acknowledgements
The authors are grateful for the helpful comments received from participants in the CReAM conference “MIGRATION: Global Development, New Frontier” held at University College London on April 10-13, 2013.
The authors are grateful to the referee for constructive comments.
Citation
Epstein, G.S., Gafni, D. and Siniver, E. (2015), "Even education has its limits: closing the wage gap", Journal of Economic Studies, Vol. 42 No. 5, pp. 908-928. https://doi.org/10.1108/JES-02-2014-0028
Publisher
:Emerald Group Publishing Limited
Copyright © 2015, Emerald Group Publishing Limited