Overeducation and Mismatch in the Labor Market

By E. Leuven, Hessel Oosterbeek. Social Science Research Network, 2011

581 citations recorded by the source corpus.

This paper surveys the economics literature on overeducation. The original motivation to study this topic were reports that the strong increase in the number of college graduates in the early 1970s in the US led to a decrease in the returns to college education. We argue that Duncan and Hoffman's augmented wage equation the workhorse model in the overeducation literature in which wages are regressed on years of overschooling, years of required schooling and years of underschooling is at best loosely related to this original motivation. We discuss measurement and estimation issues and give an overview of the main empirical findings in this literature. Finally we given an appraisal of the economic lessons learned.

Subfields: Economics and Econometrics, Education

View Paper: https://www.semanticscholar.org/paper/10309ea65a47ca58a57b3969261d416b881e573f

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Citations in the corpus

Good Skills in Bad Times: Cyclical Skill Mismatch and the Long-Term Effects of Graduating in a Recession (2016, background): “…graduates (i.e., those who were matched to the wrong industry in their first job) graduating in bad times experience persistently worse labor market outcomes when compared with mismatched work- 2See Leuven and Oosterbeek (2011) for an overview of the economics literature on skill mismatch.”
School-to-Work Linkages, Educational Mismatches, and Labor Market Outcomes (2019, methodology): ““Overeducation” and “undereducation” collectively came to be known in the economics literature as skill “mismatch” (Leuven and Oosterbeek 2011).”
The Impact of Educational Mismatch on Firm Productivity: Evidence from Linked Panel Data (2012, unknown): “Attained_educationi,j,t the number of years corresponding to the highest level of education attained by worker i employed in firm j at time t. d) UNDER*j,t is the average of the years of under-education in firm j at time t, controlling for cohort effects.”
Overeducation at the Start of the Career: Stepping Stone or Trap? (2013, methodology): “Second, we accounted for selection on unobservables, implying that our basic estimates are likely reflecting the true causal effect of overeducation and not just unobserved ability (Leuven and Oosterbeek, 2011).”