Unequal futures? Mass higher education and graduates' relative earnings in Portugal, 1995–2009

Abstract

This article analyses the evolution of relative earnings premiums for young university graduates in Portugal (1995–2009), suggesting that the previous picture of a successful transition towards mass higher education changed significantly. Our results indicate a decline in the average premium and an increasing dispersion in the returns to higher education. The relative position of graduates at the top of the wage distribution, in jobs in which the majority of workers have a degree, has, however, remained stable. These trends raise the risk of increasing expectations mismatches among recent graduate cohorts.

Keywords:

• human capital
• mass higher education
• graduates demand
• overeducation
• inequality

JEL Classification:

• I2
• J3

Notes

¹ We also exclude the agricultural/fishing/mining sectors (Sector A, NACE Rev 1.1) due to the lack of wage earners. Domestic services and extra-territorial bodies’ employees were also deleted (sectors 95 and 99, NACE Rev 1.1).