PhD Graduates with Post-doctoral Qualification in the Private Sector: Does It Pay Off?

In this paper, we address the question of the early careers of French PhD graduates in science and engineering sciences in 1996. Post-doctoral training was initially developed for PhD graduates wishing to embark on a career in the public sector. However, a large proportion of post-doctorate graduates turn to the private sector, and in particular to occupations that do not involve research. The question we raise is that of the wage premium on post-doctoral training. To control for selection bias arising in the case where unobservable elements are correlated between participation and wages, we first estimate a treatment effect model. The main finding is that when selection bias is not controlled for, post-doctoral participation increases earnings; however, when selection bias is controlled for, the participation in a post-doctoral programme has no positive effect. With regards to this finding we show that post-doctoral programmes play much more the role of a signal in the first stage of a career. This finding is also reinforced when we use a bivariate selection rule to control for the endogenous nature of having been recruited in the private sector. Copyright 2007 The Author; Journal compilation 2007 CEIS, Fondazione Giacomo Brodolini and Blackwell Publishing Ltd..