No. 108. EDUCATION IN EUROPE: EARNINGS INEQUALITY, ABILITY AND UNCERTAINTY

Published in DISCUSSION PAPERS

I. Cholezas. 2010.

 

This study attempts to investigate the role of education in earnings inequality using quantiles regression.  In particular, we calculate returns to upper secondary and tertiary education along the earnings distribution for thirteen European countries using the European Community Household Panel.  Our results indicate that the role of education in shaping earnings inequality is rather limited, since differences of quantiles regression estimates across the earnings distribution are often statistically insignificant, and depends crucially on the level of education and gender.  More precisely, in the majority of countries examined tertiary education seems to increase/decrease earnings inequality within males/females, while upper secondary education seems to increase/decrease earnings inequality within males (with minor exceptions)/females.  Further, the results indicate that interestingly education and ability in the old EU are complements for males and supplements for females. Finally, regarding uncertainty involved, tertiary education graduates and males face higher uncertainty, which is to some extent expected on the grounds of different degrees of heterogeneity.

 

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