The Signal and the Noise: The Impact of the Bologna Process on Swiss Graduates’ Monetary Returns to Higher Education

Abstract

Using longitudinal data on university leaver cohorts in the period from 2006 to 2016, we investigate the impact of the Bologna reform on Swiss graduates’ returns to higher education. Drawing on the job market signaling model, we expect lower returns for graduates who enter the labor market with a bachelor’s degree. Moreover, we expect that the initial wage difference between bachelor and master graduates will become less volatile over time, since employers constantly update their beliefs about graduates’ employability. Controlling for selection into employment and a number of different signals sent by the graduates, we find a persistent advantage of a master’s over a bachelor’s degree. The new degrees, and especially a bachelor’s degree, did indeed serve as a noisy signal about graduates’ productivity in the first years of the Bologna process.

Types of Education, Achievement and Labour Market Integration over the Life Course

“…Taken together, the contributions in this issue provide new insights into the complex relationship between types of education, educational achievement, individual and contextual factors and labour market outcomes at various stages in the life course. The results highlight, on the one hand, that different types of education go along with different employment opportunities and job quality in the long-run, and even for individuals working within the same occupation (Glauser et al, 2019;Korber, 2019;Rohrbach-Schmidt, 2019;Wicht et al, 2019). On the other hand, several contributions provide evidence that-despite these differences-there is considerable heterogeneity within types of education.…”

“…In a similar vein, educational attainment in adulthood and the concomitant labour market outcomes are related to individuals' social background and occupational status (Bratsberg et al, 2019;Luchinskaya & Dickinson, 2019). Last but not least, two cohort comparisons provide the first tentative evidence that the relationship between types of education and labour market outcomes may have changed over time (Glauser et al, 2019;Kratz et al, 2019). However, the reasons are difficult to pinpoint with the available data.…”

Did the "Bologna Process" Achieve its Goals? 20 Years of Empirical Evidence on Student Enrolment, Study Success and Labour Market Outcomes

“…This result has been established in a variety of country contexts, e.g. the Czech Republic (Raudenská and Mysíková, 2020), Germany (Neugebauer and Weiss, 2018), Portugal (Suleman and Figueiredo, 2020), and Switzerland (Glauser et al, 2019). For instance, Glauser et al (2019) show that returns to BA degrees in Switzerland differ widely between subsequent cohorts, while returns to MA degrees are quite stable over time.…”

Inequality in the Initial Wage of College Graduates at the College-Level Perspective

“…Additionally, some scholars interpret the initial wage variance from the perspective of policy. Glauser, Zangger, and Becker (2019) found that the initial wage difference between bachelor's and master's graduates will become less volatile over time, since employers constantly update their beliefs about graduates' employability [36]. Trennt and Euler (2019) found that, in the private sector, where wage development mechanisms vary, individual performance indicators play a much greater role in the wage returns of non-phd graduates, whereas among staff, control of senior positions is the most-important factor [37].…”