This punts the question to why is there a high elasticity of substitution between graduates and non-graduates? I argue it's because many graduates and non-graduates have overlapping skillsets. Many graduates work in occupations that don't require a degree.

One reason is that graduates and non-graduates were always more substitutable than the canonical race between education and technology model implied. Those results came from non-stationary time series regressions and differencing out the unit root makes that result disappear.

I get null results that are precise enough to rule out the results one might expect from previous research at the aggregate level. Therefore, the elasticity of substitution must be relatively high. Why is that?

Previous research had suggested that US graduates and non-graduates are not very substitutable (Race Between Education and Technology). We also know that the returns to a degree vary massively by subject. How substitutable are graduates from different majors?

I'm happy to share my job market paper.
It asks a simple but classic question: to what extent are graduate wages affected by the supply of graduate labour in the economy?
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