Impact of Changes in Values of Degrees on Wage Inequality: Evidence from Chile
Using the latest available data from nationally representative household surveys, we analyze the impact of changes in returns to higher education degrees on the evolution of wage inequality in Chile from 2013 to 2017. Employing a recently developed decomposition method using unconditional quantile regression and controlling for parental education levels, we find that a significant decrease in returns to professional degrees from new private universities plays a prominent role in reducing wage inequality. The effect is especially evident among younger graduates, thereby supporting the "degraded tertiary" hypothesis.
Higher education; Returns to degree; Wage inequality; Unconditional quantile regression; Chile
I23, I24, I26, J31, O15, O54
Research Institute for Economics and Business Administration
Rokkodai-cho, Nada-ku, Kobe
Faculty of Information Technology and Social Sciences
Osaka University of Economics