RIEB Discussion Paper Series No.2021-09

RIEB Discussion Paper Series No.2021-09


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

JEL Classification

I23, I24, I26, J31, O15, O54


Yoshimichi MURAKAMI
Research Institute for Economics and Business Administration
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: +81-78-803-7036
FAX: +81-78-803-7059

Tomokazu NOMURA
Faculty of Information Technology and Social Sciences
Osaka University of Economics