The new GLO Discussion Paper finds that Dutch graduates from international programs start their career with higher wages and the initial wage advantages persist in the long-run.
The Global Labor Organization (GLO) is an independent, non-partisan and non-governmental organization that functions as an international network and virtual platform to stimulate global research, debate and collaboration.
GLO Discussion Paper No. 839, 2021
Do International Study Programmes Pay off for Local Students? – Download PDF
by Wang, Zhiling & Pastore, Francesco & Karreman, Bas & van Oort, Frank
Author Abstract: International study programmes are increasing in number worldwide, but little is known about the impact on local students’ job prospects, especially in a non-English speaking countries. Using rich administrative data from Statistics Netherlands, we analyse labour market outcomes of native graduates in master programmes of Dutch universities between 2006 to 2014 within 5 years after graduation. A coarsened exact matching analysis within cohort-university-detailed field of study group addresses the self-selection issue by generating a matched sample of students with similar characteristics. We find that graduates from international programmmes obtain a wage premium of 2.3% starting from the 1st year after graduation, ceteris paribus. The wage premium keeps increasing by about 1% every year. We investigate the mechanisms through which the wage premium operates. The wage premia can neither be explained by wage increase via cross-firm mobility, nor by faster upward mobility within a firm. Instead, evidence point towards the differential characteristics of the first job upon graduation. Graduates from international programmes are much more likely to choose large firms that have a higher share of foreign-born employees and have business of trade for the first job. They get a head start in wage level and the initial wage advantages persist in the long-run.
Featured image: Mikael-Kristenson-on-Unsplash
GLO Discussion Papers are research and policy papers of the GLO Network which are widely circulated to encourage discussion. Provided in cooperation with EconStor, a service of the ZBW – Leibniz Information Centre for Economics, GLO Discussion Papers are among others listed in RePEc (see IDEAS, EconPapers). Complete list of all GLO DPs – downloadable for free.