Return to Higher Education in Russian Regions

Abstract

Estimating mincer-type wage equations on the micro-data of Occupational Wages Survey, 2007 we first receive estimates for returns to higher education for all regions-subjects of Russian Federation. Our results show that interregional differentces in re­ turns are very large in Russia. Returns to higher education received from the estima tion of basic mincerian equation lie in the range from 32 to 140% (from the average wage of workers with secondary education), and the country level of return equals to 65%. Va­riation in estimates based on an augmented wage equation (which additionally includes industries and ownership) is much lower, but it still remains quite substantial: estimates differ from about 60 to 150%, and the country level of return equals to 90%. In this re­gard, the standard approach producing one estimate of return to education for the whole country seems to be a serious simplification, and an answer to the question what is the level of return to education in Russia is no more trivial.