The Demand for Post-Compulsory Education in Four European Countries

Abstract

This study seeks to explain changes in the proportion of 16 year olds, 17 year olds and 18 year olds who decide to participate in post-compulsory education. Four countries are considered; Germany, the Netherlands, Sweden and England, over as much of the period from 1960 to the present day as data will allow. An initial inspection of the data reveals non-stationarity in virtually all of the series under consideration, so that a cointegration framework is appropriate. The analysis therefore proceeds using the two-stage procedure proposed by Engle and Granger. The results suggest that the key variable that explains the growth in post-compulsory education participation is the increase in prior academic attainment before the end of compulsory schooling. This is the case particularly for females, males being also influenced by the returns available to offering a higher level of education, and the level of real income available to 'spend' on education. The level of youth unemployment seems to play only a small part in the decision as to whether to remain in education.