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Regular version of the site

Article

Do Graduates Wages Measure the Quality of Education?A Review of Existing Studies

Educational studies. 2015. No. 1. P. 137-181.

This paper is a review of studies that investigate factors that determine starting wages of university graduates. The focus is laid upon the works addressing the question: To what extent can starting graduate wages be indicative of the quality of education received? We discuss the theoretical conceptions shedding light on the reasons for differences in wages of fresh graduates: the theory of human capital, the job market signaling theory, the theory of compensating wage differentials, and empirical studies aimed at measuring the influence various factors have on the size of starting wages. An analysis of different studies has shown that, despite the important role played by the quality of education, there are many other factors that can have an impact on wages. Such factors include heterogeneity of graduates and jobs, market imperfections, individual preferences of graduates and their strategies of entering the labor market. The provided review and critical analysis of studies designed to assess the correlations between the quality of higher education and the level of starting wages for graduates allows us to define the general requirements to data quality in case of Russia adopts the system of university graduate monitoring.