The college wage premium : changing skills and market returns

The major premium for college graduates has witnessed fluctuations throughout recent times as the skills acquired in different majors came to be valued differently by the labor market. The degree of mathematical analysis within a major is used in a stepwise regression approach to determine whether it plays a significant role in determining entry-level earnings. This paper finds that the differences between majors are statistically significant and generally consistent across both male and female graduates, adding control variables lessens the magnitude of these earnings differences but they remain significant and in some cases large. Similar to previous studies, this paper finds that the returns to Mathematics and Engineering majors are high relative to other majors. The change in the distribution of majors within each gender in addition to the evolution of major-specific wage premia leads to the finding that there remains a substantial gender wage gap