Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/283851 
Year of Publication: 
2024
Series/Report no.: 
WIDER Working Paper No. 2024/5
Publisher: 
The United Nations University World Institute for Development Economics Research (UNU-WIDER), Helsinki
Abstract: 
Using a unique panel survey of final-year undergraduates at six of the largest universities in Mozambique, we study the wage premium associated with completing an undergraduate degree. Conditional on a very rich set of controls, including pre-degree earnings, objective measures of ability, and academic performance, we find heterogeneity in 'sheepskin effects' across different kinds of firms. We propose a simple model of wage-setting in which productivity is only partially observable in some firms and fully observable in others. In this setting, education serves both to enhance productivity and as a productivity signal. Consistent with the theory, positions where productivity is likely to be less observable offer larger sheepskin effects.
Subjects: 
returns to education
wage-setting
productivity
Mozambique
JEL: 
I26
J31
Persistent Identifier of the first edition: 
ISBN: 
978-92-9267-463-2
Document Type: 
Working Paper

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