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Table 5 Test of random-effects assumption (model with and without cluster mean of earnings indicator)

From: Place of study, field of study and labour-market region: What matters for wage differences among higher-education graduates?

  M4a M4a_CM
Grade of entrance certificate (reverse-coded) 0.037** (0.012) 0.037** (0.012)
Gender (female) − 0.074*** (0.016) − 0.074*** (0.016)
Age (years) 0.011** (0.003) 0.011** (0.003)
Parents have higher education 0.013 (0.014) 0.013 (0.014)
Degree at type of institution (ref. diploma—UAS)
 Diploma/Magister—Univ. 0.029 (0.023) 0.029 (0.023)
 Bachelor—UAS − 0.106*** (0.023) − 0.106*** (0.023)
 Bachelor—Univ. − 0.164*** (0.030) − 0.165*** (0.030)
 State Examination—UAS − 0.078~ (0.041) − 0.078~ (0.041)
NUTS-2 earnings (in €100) 0.016*** (0.002) 0.014*** (0.003)
Cluster mean of NUTS-2 earnings (in €100)   0.002 (0.004)
Constant 1.844*** (0.127) 1.821*** (0.132)
Random-effects part
 SD (HEI) 0.024*** (0.021) 0.023*** (0.021)
 SD (Individual) 0.156*** (0.019) 0.156*** (0.019)
 SD (FoS) 0.317*** (0.005) 0.317*** (0.005)
Log-Likelihood − 645.644 − 645.457
LR-test (chi-square)   0.374
LR-test (p)   0.541
ICC HEI 0.004 0.004
ICC FoS 0.194 0.194
N individuals 2175 2175
N HEI 147 147
N FoS 53 53
  1. Standard errors in parentheses; standard deviations of random effects are reported
  2. ~ < 0.10, *p < 0.05, **p < 0.01, ***p < 0.001
  3. Data source: DZHW Graduate Panel 2009, BBSR Bonn 2019, authors’ calculations
  4. UAS university of applied sciences, Univ. university, HEI higher-education institution, FoS field of study