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Prestige Matters: Wage Premium and Value Addition in Elite Colleges

  • Sheetal Sekhri
American Economic Journal: Applied Economics
vol. 12, no. 3, July 2020
(pp. 207-25)
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Abstract

This paper provides evidence that graduates of elite public institutions in India have an earnings advantage in the labor market even though attending these colleges has no discernible effect on academic outcomes. Admission to the elite public colleges is based on the scores obtained in the Senior Secondary School Examinations. I exploit this feature in a regression discontinuity design. Using administrative data on admission and college test scores and an in-depth survey, I find that the salaries of elite public college graduates are higher at the admission cutoff although the exit test scores are no different.

Citation

Sekhri, Sheetal. 2020. "Prestige Matters: Wage Premium and Value Addition in Elite Colleges." American Economic Journal: Applied Economics, 12 (3): 207-25. DOI: 10.1257/app.20140105

Additional Materials

JEL Classification

  • I23 Higher Education; Research Institutions
  • I26 Returns to Education
  • J24 Human Capital; Skills; Occupational Choice; Labor Productivity
  • J31 Wage Level and Structure; Wage Differentials
  • O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration
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