Education, Occupation and Career Expectations: Determinants of the Gender Pay Gap for UK Graduates

A large proportion of the gender wage gap is usually left unexplained. In this paper, we investigate whether the unexplained component is due to misspecification. Using a sample of recent UK graduates, we introduce variables on career expectations and character traits, variables that are typically not observed. The evidence indicates that women are more altruistic and less career-oriented than men. The main difference concerns career break expectations which explains 10% of the gender wage gap in our favoured model. By omitting attitudinal variables most studies are likely to over-estimate the unexplained component of the gender wage gap. Women with a more traditional view concerning childrearing are also found to have less intensive search behaviour. These results suggest that without a change in attitudes, the gender wage gap is likely to remain at its current level.Gender wage gap, attitude

Parental Education and Child’s Education - A Natural Experiment

Is the intergenerational educational link due to nature or nurture? In order to answer this dilemma, this paper identifies the effect of parental education on their offspring’s schooling attainment using a discontinuity in the parental educational attainment. The discontinuity stems from changes in the minimum school leaving age legislation which took place in the Seventies in Britain. This strategy identifies the effect of parental schooling only for parents with a lower taste for education and may not reflect the general social returns of parental education. However, since policies are more likely to target children at risk of not maximising their educational potential, the estimates are of interest. Contrary to recent evidence, we find a positive effect of both parents education on their children’s schooling achievements when focusing on natural parents only. Step parents have no or a negative impact on children’s education. In most cases, the endogeneity of parental education is rejected. These estimates suggest substantial social returns to education for same-sex parent. The estimates are robust to the introduction of additional controls for income, labour force participation, fertility and neighbourhood quality, indicating that the effect of parental education is direct.Educational choice, intergenerational effect

Motivation, Expectations and the Gender Pay Gap for UK Graduates

Focussing on recent UK graduates, a wage gap of 12% is found. The unexplained component of the gap is small and a large fraction of the gap can be explained by subject choice, job characteristics, motivation and expectation variables. Motivation and expectations account for 44% of the explained gap, thus most studies over-estimate the unexplained component of the gender wage gap. Following stereotypes, women tend to be more altruistic and less career oriented than men, character traits that are less rewarded by employers. The principal component of the gender wage gap is expectations about childrearing. These conservative attitudes affect women’s wages even at an early stage of their career. Without a change in attitude, the gender wage gap is likely to remain.gender wage gap, attitude

Motivation, expectations and the gender pay gap for UK graduates

Focussing on recent UK graduates, a gender wage gap of 12% is found as well as significant gender differences in the subject of graduation, sector of employment and feminisation of the job. Women also are more altruistic and less career oriented than men, character traits that are less rewarded by employers. Two third of women agree that they expect to take career breaks for family reasons and more than 1/3rd of men expect their partner to sacrifice her career for childrearing responsibilities. These conservative attitudes affect womenÕs wages even at an early stage of their career and are the single most important determinants of the gender wage gap.gender wage gap, attitude

To Be or Not to Be... a Scientist?

Policy makers generally advocate that to remain competitive countries need to train more scientists. Employers regularly complain of qualified scientist shortages blaming the higher wages in other occupations for luring graduates out of scientific occupations. Using a survey of recent British graduates from Higher Education we report that fewer than 50% of science graduates work in a scientific occupation three years after graduation. The wage premium observed for science graduates stems from occupational choice rather than a science degree. Accounting for selection into subject and occupation, the returns to working in a scientific occupation reaches 18% and there is no return to a science degree outside scientific occupations. Finally, scientists working in a scientific occupation are more satisfied with their educational and career choices, which suggests that those not working in these occupations have been pushed out of careers in science.science, graduate, labour market

Subject Choice and Earnings of UK Graduates

Using a survey of a cohort of UK graduates, linked to administrative data on higher education participation, this paper investigates the labour market attainment of recent graduates by subject of study. We document a large heterogeneity in the mean wages of graduates from different subjects and a considerably larger one within subject with individuals with the most favourable unobserved characteristics obtaining wages almost twice as large as those with the worst. Moreover, gender differences in wages within subjects are also large. We then simulate a graduate tax to calculate a willingness to pay – in form of tuition fees – to capture these subject wage premia.graduate earnings, tuition fees

Sheepskin or Prozac: The Causal Effect of Education on Mental Health

Mental illness is associated with large costs to individuals and society. Education improves various health outcomes but little work has been done on mental illness. To obtain unbiased estimates of the effect of education on mental health, we rely on a rich longitudinal dataset that contains health information from childhood to adulthood and thus allow us to control for fixed effects in mental health. We measure two health outcomes: malaise score and depression and estimate the extensive and intensive margins of education on mental health using various estimators. For all estimators, accounting for the endogeneity of education augments its protecting effect on mental health. We find that the effect of education is greater at mid-level of qualifications, for women and for individuals at greater risk of mental illness. The effects of education are observed at all ages, additionally education also reduces the transition to depression. These results suggest substantial returns to education in term of improved mental health.Returns to education, mental health

Mother's education and birth weight

Low birth weight has considerable short and long-term consequences and leads to high costs to the individual and society even in a developed economy. Low birth weight is partially a consequence of choices made by the mother pre- and during pregnancy. Thus policies affecting these choices could have large returns. Using British data, maternal education is found to be positively correlated with birth weight. We identify a causal effect of education using the 1947 reform of the minimum school leaving age. Change in compulsory school leaving age has been previously used as an instrument, but has been criticised for mostly picking up time trends. Here, we demonstrate that the policy effects differ by social background and hence provide identification across cohorts but also within cohort. We find modest but heterogenous positive effects of maternal education on birth weight with an increase from the baseline weight ranging from 2% to 6%.Returns to education, health

Sheepskin or Prozac: The Causal Effect of Education on Mental Health

Mental illness is associated with large costs to individuals and society. Education improves various health outcomes but little work has been done on mental illness. To obtain unbiased estimates of the effect of education on mental health, we rely on a rich longitudinal dataset that contains health information from childhood to adulthood and thus allow us to control for fixed effects in mental health. We measure two health outcomes: malaise score and depression and estimate the extensive and intensive margins of education on mental health using various estimators. For all estimators, accounting for the endogeneity of education augments its protecting effect on mental health. We find that the effect of education is greater at mid-level of qualifications, for women and for individuals at greater risk of mental illness. The effects of education are observed at all ages, additionally education also reduces the transition to depression. These results suggest substantial returns to education in term of improved mental health.Returns to education, mental health