In many countries, the skilled labor market has lagged educational expansion. As a result of increased competition, younger cohorts of the highly educated face decreasing returns to education or overeducation. Surprisingly, decreasing occupational outcomes do not coincide empirically with the economic returns among those with tertiary education. Regarding the process of changes in economic returns to education based on cohort transformations, we expect that the expansion of tertiary education affects specific cohorts, which find themselves facing more labor market competition. As a result, the economic returns to education should decrease among younger cohorts even when the overall returns to education remain stable over time. To study this process, we model economic returns with a new age-period-cohort-trended lag (APCTLAG) method, which allows us to compare the gap in economic returns between tertiary and less than tertiary education over cohorts. Using the Luxembourg Income Study (LIS), we analyze trends over three decades in 12 countries. Our results confirm that educational returns for tertiary education have declined over time, even though the gap between the educated and the less educated has remained similar in most of the countries. For younger cohorts, tertiary education has become more necessary to survive in the competitive labor market, but the actual economic returns have decreased-making tertiary education less sufficient than before.

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Objectives Our understanding of how societal conditions and educational policies influence cognitive development across the life course is improving. We tested the extent to which inequality of educational opportunity (IEO), the country- and cohort-specific correlation of parents' and their offspring's length of schooling, offers systematically different opportunities to contribute to cognitive development, which in turn influences cognitive abilities up to older ages. Methods A total of 46,972 individuals of three cohorts born 1940–63 from 16 European countries and Israel provided up to six cognitive assessments and information on covariates in the SHARE survey 2004–2017. Individual-level data were linked to indicators of IEO at time of schooling, and economic, health, and human development, provided by World Bank, WHO, and the UN. Results In multilevel (mixed-effects) models with random individual and country-cohort effects and adjusted for a large set of confounders, higher IEO was associated with lower levels of cognitive functioning in men and women. Interaction analyses suggested lower cognitive levels particularly of women who were schooled in higher IEO contexts and had lower educational attainment. Associations with rate of change in cognitive functioning were present only in women, however there was little clinically relevant cognitive decline across the window of observation. Result patterns were mostly consistent after including additional contextual indicators, and in a subsample with childhood information. Discussion Findings suggest that IEO is able to substantially influence cognitive development with long-lasting impacts. Lower-educated women of the cohorts under investigation may have been particularly vulnerable to high-inequality educational contexts.