More investment-less returns. Changeing returns to education in Italy across three decades

More investment, less returns? Changing returns to education in Italy across three decades Summary: Educational expansion has often been discussed in terms of possibly declining returns to education. The theoretical debate provides arguments supporting both expectations about declining and increasing returns. Declining returns would not only menace individual investment strategies but also put under pressure the merit based legitimisation of existing social inequalities. In this paper we empirically investigate these changes over time. In recent years, Italy has witnessed a strong increase in education participation beyond compulsory schooling – though this country still lags behind most of Europe regarding access to higher education. At the same time, the occupational structure has not shown any noteworthy upward shift. We describe the trend in the association between educational attainment and labour market outcomes in terms of employment chances and occupational position based on national labour force survey data covering the period from 1985 to 2010. Our results for men and women aged 30-39 show a clear decline in the returns to education, in particular concerning those with an upper secondary education. However, those with a university education have also seen a worsening of their occupational condition, especially in recent years.