The Wage Premium on Tertiary Education: NEW ESTIMATES FOR 21 OECD COUNTRIES COUNTRIES

This paper presents cross-section estimates of gross hourly wage premia on tertiary education. They are based on a unified framework for 21 OECD countries from the 1990s to the early 2000s and use international household surveys to maximise international comparability. The results of the "augme...

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Bibliographic Details
Published in:OECD Economic Department Working Papers 2007-12 (589), p.0_1
Main Authors: Strauss, Hubert, de la Maisonneuve, Christine
Format: Article
Language:English
Subjects:
Academic achievement
Bias
Comparative studies
Continuing education
Earnings
Education
Educational attainment
Estimates
Gender
Gross income
Households
Human capital
Investments
Labor market
Variables
Wages & salaries
Women
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Summary:This paper presents cross-section estimates of gross hourly wage premia on tertiary education. They are based on a unified framework for 21 OECD countries from the 1990s to the early 2000s and use international household surveys to maximise international comparability. The results of the "augmented" Mincerian wage equations point to an average hourly gross wage premium on completed tertiary education of 55% in 2001 (country-gender average), translating into a premium of close to 11% per annum of tertiary education. Wage premia display little variation over time but huge cross-country variation: at 6% they are lowest in Greece and Spain (men and women) as well as in Austria and Italy (women) while reaching 14%-18% in Hungary, Portugal, and in most Anglo-Saxon countries. Given that the wage premium is the single most important driver of private returns to education, the results presented here have potentially important implications for policies that aim at increasing investment in human capital. [PUBLICATION ABSTRACT]
ISSN:1815-1973