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University Selectivity and the Graduate Wage Premium: Evidence from the UK

Author

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  • Walker, Ian

    (Lancaster University)

  • Zhu, Yu

    (University of Dundee)

Abstract

We study the relative labour market wage outcomes of university graduates in the UK using the Labour Force Survey (LFS), matched to mean standardised admission scores at the institution*subject*cohort level using data on high school achievement scores of students admitted to these courses. Unlike earlier UK studies, we are able to consider the effect of differences in undergraduate degree subjects, degree class, and in particular the selectivity of the subject at the Higher Education Institution (HEI) attended. Our results show that selectivity of undergraduate degree programmes plays an important role in explaining the variation in the graduate wage premium across HEIs and subjects. In fact, much of the observed differential in relative wage outcomes across institutions*subjects is due to the quality of students that HEIs select.

Suggested Citation

  • Walker, Ian & Zhu, Yu, 2017. "University Selectivity and the Graduate Wage Premium: Evidence from the UK," IZA Discussion Papers 10536, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp10536
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    References listed on IDEAS

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    Cited by:

    1. David Carroll & Chris Heaton & Massimiliano Tani, 2019. "Does It Pay to Graduate from an 'Elite' University in Australia?," The Economic Record, The Economic Society of Australia, vol. 95(310), pages 343-357, September.
    2. Schwerter, Jakob, 2020. "Impact of universities in a flat hierarchy: Do degrees from top universities lead to a higher wage?," VfS Annual Conference 2020 (Virtual Conference): Gender Economics 224583, Verein für Socialpolitik / German Economic Association.
    3. Milla, Joniada, 2017. "The Context-Bound University Selectivity Premium," IZA Discussion Papers 11025, Institute of Labor Economics (IZA).
    4. Andrew Leigh, 2021. "Australian Mobility Report Cards: Which Universities Admit the Most Disadvantaged Students?," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 54(3), pages 331-342, September.

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    More about this item

    Keywords

    graduate wage premium; college selectivity;

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education

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