Market and Private Determinants of University Major Choice in Russia

University major choice is an important decision that affects the future labor market outcomes of university graduates. This decision was made according to the economy needs in the USSR, then the USSR collapsed, and it becomes important to understand how high school graduates choose majors now. We estimated simultaneously employment status equation, logarithm of hourly wage equation and major choice model on the female sample, and found that major choice depends on both market characteristics, such as existence of planned economy at the time of entering university, and individual characteristics, such as knowledge of foreign language and family background. A business and economics major is the most paid across women in Russia and an education major has the lowest return. Moreover, we do not find any selection on unobservables in the Russian data.