Does education raise productivity and wages equally? The moderating role of age and gender

Table 2 Estimates for the entire sample, three educational categories

	GMM-SYS			LP
	Value added per hour worked (ln)	Wage cost per hour worked (ln)	Value added-wage cost gap^c	Value added per hour worked (ln)
	(1)	(2)	(3)	(4)
Lagged dependent variable (ln)	0.619^*** (0.050)	0.447^*** (0.135)	0.613^*** (0.046)	0.791^*** (0.043
Shares of worker^a
Low-educated (E12)	Reference	Reference	Reference	Reference
Middle-educated (E34)	0.106^** (0.053)	0.027^** (0.013)	0.027 (0.021)	0.019^** (0.009)
High-educated (E567)	0.258^*** (0.092)	0.145^*** (0.047)	0.055^* (0.031)	0.128^*** (0.026)
Hansen over-identification test, p value	0.175	0.132	0.619
Arellano-Bond test for AR(2), p value	0.384	0.342	0.219
Number of observations	6714	6714	6714	6691
Number of firms	1844	1844	1844	1844
Chi-squared statistic for equality of regression coefficients, H₀
E34 = E567	2.85^*	6.24^**	1.15	17.83^***
Interpretation^b	E12 < E34	E12 < E34	E12 < E567	E12 < E34
	E12 < E567 E34 < E567	E12 < E567 E34 < E567	but E12 = E34 E34 = E567	E12 < E567 E34 < E567
	⇒Education increases productivity	⇒Education increases wage costs	⇒E567 more profitable than E12	⇒Education increases productivity

Notes: Standard errors, that are robust to heteroskedasticity and autocorrelation, are reported between parentheses. Regressions also control for: % of workers with 10 years of tenure or more; % workers younger than 30 and older than 49 years, respectively; % women; % part-time workers; % blue-collar workers; % workers with fixed term employment contract; % apprentices; % temporary agency workers; ln of firm size; ln of capital stock per worker; level of collective wage bargaining; region where the firm is located (2 dummies); industries (8 dummies), and years dummies (11). AR (2) refers to second-order autocorrelation in first-differenced errors. GMM-SYS specifications include first and second lags of explanatory variables (except time dummies) as instruments
^***p < 0.01, ^**p < 0.05, ^*p < 0.1
^aLow-educated workers (E12) have at most a degree of lower secondary school. Middle-educated workers (E34) have at most a degree from upper (general, technical or professional) secondary school. High-educated workers (E567) have a tertiary educational attainment (i.e. at least a Bachelor’s or equivalent degree)
^b‘<’ (‘=’) indicates if regression coefficients are (not) statistically different at the 10% level
^c Value added-wage cost gap = ln(value added per hour) − ln(wage cost per hour)