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Title:Does Education Reduce Wage Inequality? Quantile Regressions Evidence from Fifteen European Countries PDF Logo
Authors:Pereira, Pedro Telhado
Martins, Pedro Silva
Issue Date:2000
Series/Report no.:IZA Discussion paper series 120
Abstract:We address the impact of education upon wage inequality by drawing on evidence from fifteen European countries, during a period ranging between 1980 and 1995. We focus on within-educational-levels wage inequality by estimating quantile regressions of Mincer equations and analysing the differences in returns to education across the wage distribution and across time. Four different patterns emerge: 1) a positive and increasing contribution of education upon within-levels wage inequality ?the case of Portugal; 2) a positive but stable role of education in terms of inequality – Austria, Finland, France, Ireland, Netherlands, Norway, Spain, Sweden, Switzerland, UK; 3) a neutral role – Denmark and Italy; and 4) a negative impact – Germany and Greece. We thus find that in most countries dispersion in earnings increases with educational levels and that education is a risky investment. These results suggest a positive interaction between schooling and ability with respect to earnings.
Subjects:Returns to education
earnings inequality
quantile regressions
ability
education systems
labour-market institutions
JEL:D31
C29
J31
J24
I21
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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