This paper reports estimates of the UK “college premium” for young graduates
across successive cohorts from large cross section datasets for the UK pooled from
1994 to 2006 - a period when the higher education participation rate increased
dramatically. The growth in relative labour demand suggests that graduate supply
considerably outstripped demand which ought to imply a fall in the premium. We find
no significant fall for men and even a large, but insignificant, rise for women. Quantile
regression results reveal a fall in the premium only for men in the bottom quartile of
the distribution of unobserved skills.
