The overarching objective of the proposed research is to understand the relationship between education and wage inequality. The research will explore the structure and change in wage inequality within and across European countries, using comparable data. Furthermore it will seek to explain the observed patterns and trends within and between cohorts in terms of the interplay between educational expansion and wage inequalities and educational systems and labour market institutions The research will be focussed to derive the practical implications of our analysis for economic and social policy.

Within this framework, the present proposal divides into the following detailed aims:

• Comprehensive literature review on education and wage inequality that sets out the current state-of-the-art with respect to scientific results, policy implications and knowledge gaps.
• In-depth analysis of the structure and change in European wage inequality in order to provide a broad-based European-wide picture of the static and dynamic nature of overall wage inequality and its between and within dimensions.
• To further enhance understanding of the education-wage link between cohorts and its evolution over time within and between the European countries, with special reference to intergenerational effects arising from the expansion in higher education.
• To further enhance the analysis of the education-wage link within cohorts and its evolution over time within and between the European countries, with special reference to intragenerational effects arising from the expansion in higher education.
• To draw together this multitude of results produced by means of several alternative but highly complementary approaches and methodologies in an attempt to evaluate the relative importance of the between and within dimensions for overall wage inequality.
• To analyse a number of possible policy-relevant explanations for the observed patterns and trends. Among the explanations to be investigated are: labour market institutions and flexibility arrangements; educational, skill and institutional quality differences; over-education and job competition; gender differences; and experience and training.