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The Incidence And Wage Effects Of Overeducation: The Case Of Taiwan


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  • Chun-Hung A. Lin

    (Department of Economics, Chinese Culture University)

  • Chun-Hsuan Wang

    (Department of Finance, Ming Chuan University)

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    This paper, based on data from Survey of Family Income and Expenditure of Taiwan, shows that the recent trends of job match in Taiwan labor market have been marked by increasing proportion of overeducated workers due to the higher education expansion policy, while the incidence of undereducation continues to decline. Furthermore, workers¡¯ economic position is not completely determined by their educational levels. Working experience also plays an important role in workers¡¯ job placement and their wages. Workers with relatively less working experience are more likely to be overeducated, while workers with relatively more working experience are more likely to be undereducated. Overeducated (Undereducated) workers would earn more (less) than their co-workers with adequate education but less (more) than the workers having the same educational level with adequate education for jobs. However, the rewards (penalties) to adequate education and overeducation (undereducation) decline as more experience accumulated. Evidence also shows effect of bumping down from overeducation on the wages and employment of lower educated workers.

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    Bibliographic Info

    Article provided by Chung-Ang Unviersity, Department of Economics in its journal Journal Of Economic Development.

    Volume (Year): 30 (2005)
    Issue (Month): 1 (June)
    Pages: 31-47

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    Handle: RePEc:jed:journl:v:30:y:2005:i:1:p:31-47

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    Keywords: Overeducation; Wage; Bumping Down; Labor Market; Taiwan;

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    1. Duncan, Greg J. & Hoffman, Saul D., 1981. "The incidence and wage effects of overeducation," Economics of Education Review, Elsevier, vol. 1(1), pages 75-86, February.
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    Cited by:
    1. Kedir, Abbi & Kyrizi, Andri & Martínez Mora, Francisco,, 2012. "Signalling and Productivity Effects of Overeducation: Is It Really a Waste of Resources?," Working Papers 2072/203170, Universitat Rovira i Virgili, Department of Economics.
    2. Ching-Yuan Lin & Chun-Hung Lin, 2012. "Does Higher Education Expansion Reduce Credentialism and Gender Discrimination in Education?," Social Indicators Research, Springer, vol. 109(2), pages 279-293, November.


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