Elitism in Higher Education and Inequality: Why Are the Nordic Countries So Special?

This paper shows that countries with high levels of ‘elitism’ in higher-education are the countries displaying high levels of inequality. In other words, a higher level of ‘elitism’, i.e., large gap in quality of universities, and tight selection in top universities leads to a wider gap in wages between the tradable and service sectors, which leads also to a higher Gini index.
This paper shows that the Nordic countries display lower elitism in higher education as well as lower inequality than most of the other OECD countries.
Keywords: Ability, elitism, inequality, Gini index, higher education, human capital, wage differential.
JEL classification: F12, F16, F66, I26, J24, O14.