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Book part
Publication date: 25 February 2016

Elena Crivellaro

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…

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.

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Inequality: Causes and Consequences
Type: Book
ISBN: 978-1-78560-810-0

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Book part
Publication date: 25 February 2016

Abstract

Details

Inequality: Causes and Consequences
Type: Book
ISBN: 978-1-78560-810-0

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