JRC Working Papers in Economics and Finance No. 2019/5
International student mobility is the most recognised element of Erasmus+, a major EU policy. Not enough is known about the causal effect of studying abroad on labour market outcomes. This is because most of the existing studies dismiss selection bias: the different composition of students opting and not opting for studying abroad. The purpose of this paper is to answer the following three questions, whilst accounting for the selection bias into mobility. First, does international student mobility (ISM) have a positive effect on labour market outcomes? Second, do the returns to ISM vary between two countries with contrasting labour market and education systems? Third, do the returns to ISM differ according to the socio-economic background of the students? Results are compared between Italy and the UK using Italian Institute of National Statistics and UK Higher Education Statistics Agency graduate survey data. Using propensity score matching, the returns to study-related stays abroad are estimated on a set of labour market outcomes around six to twelve months and three years after graduation for undergraduates (UK and Italy) and postgraduates (Italy only). Results confirm that mobility is positively associated with the outcome variables under scrutiny. Mobile graduates benefit from slightly greater employment chances than nonmobile graduates. Returns to ISM tend to be higher among graduates in Italy. The most sizable effect is found for mobiles’ higher propensity to enroll in further studies. The latter is more likely for the socially disadvantaged graduates, which might contribute to reducing income inequality in the long term.
international student mobility mobility abroad labour market outcomes propensity score matching Italy UK