The wage return to graduate in Italian small-town universities

In this paper we use a representative sample drawn from the "Indagine Statistica sull'Inserimento Professionale dei Laureati" by the Italian National Statistical Institute and data from the Italian Ministry of Education to look at the wage premium of graduates from a regional university (i.e. not located in a metropolitan area) relative to graduates from a non-regional university, three years after graduation. Our results show that, after accounting for observed characteristics of individuals and universities, a wage premium is associated with a degree from a regional university. This finding may be interpreted as showing that regional universities enhance the local human capital stock or create specific skills needed by the local economic environment.