The Changing Economic Value of Higher Education in Developed Economies: A Report to the O.E.C.D.
NBER Working Paper No. 820
This paper analyses the changing economic value of higher education in the major O.E.C.D. countries. The first part of the study examines data on earnings by education or earnings in occupations composed of per- sons with different educational attainments. A second part looks at un- employment rates and the occupations attained by college graduates. Both the relative earnings data and the unemployment and occupational attainment data suggest that the heralded decline in the economic value of higher education in the U.S. is not a unique North American phenomenon, but rather, a general development throughout the developed world. On the basis of evidence on elasticities of substitution and the observed growth in the supply of college graduates the paper suggests that the decline in the premium to the educated reflects movement along a reasonably well-defined demand for graduates schedule due to the growth of the college and university systems of the various countries.