Educational mismatch, wages, and wage growth: Overeducation in Sweden, 1974–2000

Korpi, Tomas; Tåhlin, Michael

doi:10.1016/j.labeco.2008.08.004

Cited by 194 publications

(203 citation statements)

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“…Tåhlin, 2009; Leuven and Oosterbeek, 2011); 2) by means of IV estimates, which, however, have also to face the lack of suitable instruments due to the strong link between the probability of being overeducated and the wage earned (Korpi and Tåhlin, 2009) In the case of the AlmaLaurea data, unfortunately, approach 1) cannot be implemented due to the unavailability of the longitudinal dimension of the data; approach 2) has been tested in omitted estimates which are the result of considerable experimentation, using a large set of different instrumental variables none of which overcame the two conditions for being a good instrument and especially the exclusion restriction; and approach 3) is actually controlled for with a whole battery of proxies for the individual unobserved lower ability of the overeducated.…”

Section: Methodsmentioning

confidence: 99%

“…In the past, endogeneity has been handled in different ways in the estimates of wage penalty associated to overeducation: fixed effects regressions (Bauer, 2002;Cutillo and Di Pietro, 2006); IV estimates within the context of cross-section data (Korpi and Tåhlin, 2009); and, more recently, the direct inclusion of ability controls to catch differences in skill levels between the overeducated and the rest of the sample (Allen and Van der Velden, 2001;Korpi and Tåhlin, 2009). Kleibrink (2016) uses all of these methods.…”

Section: A Survey Of the Empirical Literaturementioning

confidence: 99%

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Overeducation at a Glance. Determinants and Wage Effects of the Educational Mismatch Based on AlmaLaurea Data

Caroleo

2017

Soc Indic Res

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. This essay delivers two main innovations with respect to the existing literature. First, and foremost, by extending the work of Nicaise (2010) relative to the reservation wage to the case of overeducation, we propose a statistical test to discriminate between alternative theoretical interpretations of the determinants of overeducation through the Heckman sample selection procedure. Second, the essay provides the first available economic analysis of the consequences of the educational mismatch in Italy as based on AlmaLaurea data, the largest and richest data bank available in the country. The data includes a large number of university graduates enrolled in a given year before the Bologna reform and asks a large number of questions allowing us measuring among others the quality of education from high school. This wealth of information is a condition to provide the most comprehensive, accurate and reliable assessment of overeducation in the country. The educational mismatch 5 years from graduation is relatively high -at 11.4% and 8% for overeducation and overskilling, respectively -by EU standards. Ceteris paribus the parents of the mismatched have lower educational levels according to school tracking. Most humanities and social sciences degrees but also geology, biology and psychology are associated with both types of mismatch. The quality of education also correlates to the educational mismatch. We find a nonconditional wage penalty associated to overeducation and overskilling of 20% and 16% and a conditional (2012); University of Salerno (2013). We thank all seminar participants and particularly Lilia Costabile, Giuseppe Croce, Hans Dietrich, Francesco Ferrante, Claudio Lucifora, Nadia Netti, Patrizia Ordine, Marco Pecoraro, Claudia Pigini, Giuseppe Rose, Dario Sciulli, Francesca Sgobbi and Peter Sloane for valuable comments on earlier versions of this paper. This notwithstanding, the authors are solely responsible for the opinions expressed in this paper. Terms of use: Documents in2 one of about 12% and 7%, respectively. The Heckman sample selection model returns a slightly higher sample selection corrected wage penalty, supporting not only the job competition and job assignment models, but also the human capital model. Other concurrent statistical tests point to the difficulty that the educational system faces in providing work-related skills to graduates.

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Section: Methodsmentioning

confidence: 99%

Section: A Survey Of the Empirical Literaturementioning

confidence: 99%

Overeducation at a Glance. Determinants and Wage Effects of the Educational Mismatch Based on AlmaLaurea Data

Caroleo

2017

Soc Indic Res

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“…For cross-sectional data 17 , unobserved heterogeneity can be approximated by using a proxy for ability (Cainarca and Sgobbi 2012;Chevalier 2003;Korpi and Tåhlin 2009), splitting the sample into more homogeneous (e.g., in terms of earnings) sub-samples (Budría 2011;McGuinness and Bennett 2007) or controlling for the envi- 17 There are more options if panel data are available, but because ESS is a cross-sectional dataset, these are not reviewed here. ronment where the individual was raised (Korpi and Tåhlin 2009). Personality is another important source of unobserved heterogeneity, but it was used by only two studies in the context of mismatch (Blázquez and Budría 2012;Tarvid 2013).…”

Section: Polarization and Individual-level Skills Mismatchmentioning

confidence: 99%

Imbalanced Job Polarization and Skills Mismatch in Europe

Sparreboom

Tarvid

2016

J Labour Market Res

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This paper considers the education of the labour force based on an analysis of trends in and the relationships between job polarization and skills mismatch. Both job polarization and skills mismatch have become topics of increasing interest, but relationships between the two have been relatively neglected in the literature. We argue that the relationship between polarization and skills mismatch is an empirical matter, which we analyse at both the macroeconomic and microeconomic level in European countries. A novel job polarization index (JPI) is proposed to measure imbalanced job polarization. It takes into account not only the change in the share of medium-level jobs, as is typical for measuring pure polarization, but also the imbalance between the change in high-level and low-level jobs. Skills mismatch at macrolevel is measured by a skills mismatch index (SMI), while traditional measures of undereducation and overeducation are used at the microeconomic level. At the macroeconomic level, we estimate a system of two equations, one for each of the country-level variables gauging polarization and mismatch, respectively. Imbalanced job polarization measured Electronic supplementary material The online version of this article (doi:10.1007/s12651-016-0196-y) contains supplementary material, which is available to authorized users.Responsibility for opinions expressed in this paper rests solely with the authors and does not constitute an endorsement by the ILO. by the JPI negatively affects skills mismatch at the macroeconomic level (SMI), but there is no significant reverse effect. Thereafter we consider the microeconomic level and study the determinants of mismatch using multi-level mixed effects logistic models. The effect of imbalanced job polarization on individual-level mismatch was arguably favourable for individuals in non-crisis time, decreasing overeducation risk although also increasing the chances of undereducation, both gauged using the normative measure, but unfavourable during the global financial crisis of 2008-2009 and the following two years.

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“…One approach involves the consideration of panel data sets in order to control for all unobserved individual fixed effects (Bauer, 2002;Frenette, 2004;Korpi and Tåhlin, 2009;Tsai, 2010). They find that the wage penalty associated with being overeducated falls dramatically and even disappears when it is estimated by fixed effects, suggesting that (part of) the effect of educational mismatch is caused by unobserved individual ability.…”

Section: Literature Reviewmentioning

confidence: 99%