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Does University Level the Playing Field? Impacts of Spatial Inequalities on the Gap in the Earnings of Similar Graduates: Evidence from the UK

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Abstract

This paper examines if universities in the UK mediate the impacts of spatial inequalities on earnings disparities among similar graduates and provides new evidence on the persistent income inequality at the neighbourhood level, using the Destination of Leavers from Higher Education (DLHE) survey data on the population of individuals graduating from universities in 2012/13. The results suggest that graduates from neighbourhoods with the highest university participation rate, on average, have higher earnings than those from the lowest-participation neighbourhoods, holding demographic features and university-related factors constant. The earnings gap by the neighbourhood quality remains substantial so that males from the lowest-participation neighbourhoods with a degree from the Russell Group barely earn higher incomes than their peers from the highest-participation areas who attended a less prestigious university. These results imply that universities in the UK do not fully level the playing field in terms of earnings disparities among graduates from different neighbourhoods.

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Notes

  1. Regional gross value added (GVA) is the value generated by any unit engaged in the production of goods and services. GVA per head is a useful way of comparing regions of different sizes (Office for National Statistics, 2018).

  2. The Gautreaux Assisted Housing Programme was the US’s first housing mobility programme helping families move from poor and segregated areas into racially and economically diverse suburban communities. By the time the programme ended in 1998, it had helped over 7,100 families (more than 25,000 individuals) relocate to neighbourhoods that were safer and offered better job and educational opportunities (BPI, 2015).

  3. The Moving to Opportunity (MTO) is a major randomised housing mobility experiment sponsored by The United States Departments of Education and Housing and Urban Development. Starting in 1994, the MTO offered housing vouchers for low-income families to move from high-poverty neighbourhoods to low-poverty neighbourhoods (Chetty et al., 2016; Baum and McPherson, 2022).

  4. POLAR classifies local areas into five groups, based on the proportion of 15 years old who entered universities by the age of 19. These rates are used to assign wards into five quintiles. Wards are contiguous areas that are large enough to typically refer to a recognisable named neighbourhood and the primary unit of English electoral geography for civil parishes, borough, and district councils.

  5. Higher Education (HE) providers with similar origins and ambitions often form alliances to encourage collaboration, build relationships with local businesses and produce impactful research. Such a mission group is a typology and not necessarily hierarchical; however, the Russell Group, which comprises 24 research intensive universities, e.g., Cambridge, Oxford, London School of Economic, and Imperial College London, is often considered as the most prestigious universities in the UK. The Guild HE is a group of universities, further education (FE) colleges, professional bodies, and specialist institutions that specialise in various fields, e.g., art, design/media, music/performing arts, education, business, and health (GuildHE, 2021). The Million Plus is a group of younger or more modern universities focusing on research that drives economic, social, and cultural changes (MillionPlus, 2021). The University Alliance is an association of universities, which was formed in 2006, and its membership mainly comprises technical and professional universities with a mission to drive economic growth in Britain’s cities and regions, with a particular focus on links with industry (University Alliance, 2017). The 1994 Group comprised 19 universities in the group, all of which had relatively higher entry requirements. Though the 1994 Group formally dissolved in November 2013 after 19 years of history, the analysis in this paper still includes this group given that the target cohort for the analysis is those who graduated in 2012/13.

  6. Any readers interested in the details regarding the multiple imputation and the results of this action can contact the author.

  7. The variable indicating whether an individual attended a private school is considered as the system-wide measure of human capital (S) since a vast body of literature in the field has suggested peer influences within private school environments are strong enough to overweigh the effect of true learning on various life outcomes (Green et al., 2017).

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    Sangwoo Lee

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Lee, S. Does University Level the Playing Field? Impacts of Spatial Inequalities on the Gap in the Earnings of Similar Graduates: Evidence from the UK. High Educ Policy 36, 847–870 (2023). https://doi.org/10.1057/s41307-022-00292-y

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