Universities Attended have Little Influence over Starting Salaries

According to a study in The Australian Economic Review published by Wiley-Blackwell, it is the type of employment obtained that determines labour market outcomes and remuneration.

The paper, “The influences of institution attended and field of study on graduates’ starting salaries” used a semi-logarithmic earnings equation to examine if alleged differences across universities are reflected in the labour market outcomes of Australian graduates.

The results indicated minimal effects on starting salary determination associated with attending high ranking universities and fields of study. In comparison with degree type variables which only varied by 12 percentage points, employment-related variables had strong effects with starting salaries differing up to 30 percentage points across industries and 33 percentage points across occupations.

“Australian universities place great emphasis on differentiating themselves on the basis of quality – as evidenced in their references to their Go8 membership, various accreditations, status in Hobson’s Good Universities Guide and placement in national and international rankings. However, the results of our study demonstrates that it is what you do in the labour market, and not where or what you studied; that really matters”, said co-author Elisa Rose Birch from the University of Western Australia.

Findings suggest that instead of enrolling in a prestigious university to obtain a premium pay scale in the labour market, it is more effectual to enroll in a premium discipline – such as engineering, public health, and management – or to pursue a career in an industry or occupation that pays well.

--------------------------------------------------------------------------------

This paper is published in The Australian Economic Review (Vol. 42, Issue 1, pp. 42 - 63).

Journalists wishing to receive a PDF should contact Alina Boey, Senior Manager, Corporate Communications at aboey@wiley.com or phone +65-96565580.

About The Australian Economic Review
An applied economics journal with a strong policy orientation, The Australian Economic Review publishes high quality articles applying economic analysis to a wide range of macroeconomic and microeconomic topics relevant to both economic and social policy issues. Produced by the Melbourne Institute of Applied Economic and Social Research, it is the leading journal of its kind in Australia and the Asia-Pacific region. Whilst of special interest to Australian academics, students, policy makers, and others interested in the Australian economy, the journal also considers matters of international interest.

The Australian Economic Review is a peer reviewed journal and is included in the Social Sciences Citation Index.

http://www3.interscience.wiley.com/journal/122264776/abstract

Media Contact
Alina Boey
Senior Manager, Corporate Communications
Wiley-Blackwell, Asia-Pacific
2 Clementi Loop, #02-01
Singapore, 129809
Singapore
+65-64604321 (phone)
+6564689358 (fax)
aboey@wiley.com.sg