Education and Economic Rewards. Variations by Social-Class Origin and Income Measures

Abstract

The main question raised here is whether the levels of reward among people with similar education, both with respect to level and field, vary by social‐class origin. It is argued that social‐class origin is likely to have greater impact on economic rewards among those educated in ‘soft’ than in ‘hard’ educational fields, because performance is more easily measured in the latter category. A further question is how the choice of income measure affects the conclusions about variations in economic rewards. Do the conclusions based on analyses of wages and salaries differ from conclusions based on broader measures including self‐employed income and stock returns? The data used to answer these questions consist of 10 per cent of the Norwegian population between the ages of 30 and 41 in 1996. These data contain very detailed information on education. Various forms of income are included, based on information from the public tax register. The analysis documents that those origination in the higher classes tend to obtain the highest level of economic rewards, even when educational level and field are controlled. Economic inequality is greatest when a broad income measure s used that includes various forms of income. Those who originate in the economic sector of the higher classes tend to have the highest level of rewards. Finally, the impact of social‐class origin varies to a large extent among educational fields, and tends to be largest in ‘soft’ educational fields. These findings indicate that processes occurring in the labour market contribute to enduring patterns of class inequality over generations.