Impact of Graduating with Honours on Entry Wages of Economics Majors*

Atay S., Asik G. A., Tümen S.

Oxford Bulletin of Economics and Statistics, vol.86, no.3, pp.606-640, 2024 (SCI-Expanded) identifier

  • Publication Type: Article / Article
  • Volume: 86 Issue: 3
  • Publication Date: 2024
  • Doi Number: 10.1111/obes.12593
  • Journal Name: Oxford Bulletin of Economics and Statistics
  • Journal Indexes: Science Citation Index Expanded (SCI-EXPANDED), Social Sciences Citation Index (SSCI), Scopus, International Bibliography of Social Sciences, Periodicals Index Online, ABI/INFORM, Business Source Elite, Business Source Premier, CAB Abstracts, EBSCO Education Source, EconLit, Public Affairs Index, vLex, DIALNET
  • Page Numbers: pp.606-640
  • TED University Affiliated: Yes


Employers use various proxies to predict the future labour productivity levels of the job applicants. Success in school, especially in high-level coursework, is among the most widely used proxies to screen entry-level candidates. We estimate the causal effect of graduating with honours (i.e. with a grade point average of 3.00 and above out of 4.00) on the starting wages of economics majors in Türkiye. Using comprehensive micro data on all economics majors between 2014 and 2018, matched with administrative records about their first jobs, we implement a regression discontinuity analysis to investigate whether there is any statistically significant jump in the starting wages at the honours-degree cutoff. We find that graduating with honours increases the wages of males, while there is no impact on females. We further document that the impact on males is almost entirely driven by the graduates of non-elite universities. In particular, graduating with an honours degree increases the entry wages of males from non-elite universities by about 4%, on average. We provide an explanation for these patterns using the theory of statistical discrimination. We discuss the potential reasons behind the heterogeneous signal value of graduating with honours between males vs. females and elite versus non-elite university graduates.