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Educational returns, ability composition and cohort effects: theory and evidence for cohorts of early-career UK graduates

Ireland, Norman and Naylor, Robin A. and Smith, Jeremy and Telhaj, Shqiponja (2009) Educational returns, ability composition and cohort effects: theory and evidence for cohorts of early-career UK graduates. CEP Discussion Paper, No. 939. Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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Identification Number: No. 939

Abstract

An increase over time in the proportion of young people obtaining a degree is likely to impact on the relative ability compositions (i) of graduates and non-graduates and (ii) across graduates with different classes of degree award. In a signalling framework, we examine the implications of this on biases across cohorts in estimates of educational returns. In an empirical analysis, we exploit administrative data on whole populations of UK university students for ten graduate cohorts to investigate the extent to which early labour market outcomes vary with class of degree awarded. Consistent with our theoretical model, we find that returns by degree class increased across cohorts during a period of substantial graduate expansion. We also corroborate the empirical findings with evidence from complementary data on graduate sample surveys.

Item Type: Monograph (Discussion Paper)
Official URL: http://cep.lse.ac.uk/
Additional Information: © 2009 The authors
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HV Social pathology. Social and public welfare. Criminology
L Education > L Education (General)
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Series: Working Papers > CEP Discussion Papers
Date Deposited: 13 Jul 2010 15:20
Last Modified: 14 Nov 2012 10:19
URI: http://eprints.lse.ac.uk/id/eprint/28608

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