Higher Education Quality, Opportunity Costs and Labor Market Outcomes
AbstractThis paper studies educational choices in a signaling setting in segmented labor markets. We show that in the presence of heterogeneous working ability imperfectly correlated with schooling costs, equilibria characterized by overeducation may arise. The quality of education is crucial in determining the extent of this phenomenon conditional on labor market features. To find evidence of the main implications of the model we use data of Italian graduates merged with the CIVR data set and disaggregated by geographical areas. We find that overeducation is strongly determined by university quality and by other variables that characterize the individual's socioeconomic background. In particular, the impact of education quality on educational mismatch appears to be higher in less developed areas.
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Bibliographic InfoArticle provided by SIE - Societa' Italiana degli Economisti (I) in its journal Rivista Italiana degli Economisti.
Volume (Year): 14 (2009)
Issue (Month): 2 (August)
Other versions of this item:
- Ordine Patrizia & Rose Giuseppe, 2009. "Higher Education Quality, Opportunity Costs and Labor Market Outcomes," Rivista italiana degli economisti, Società editrice il Mulino, issue 2, pages 267-292.
- C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models
- C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
- I20 - Health, Education, and Welfare - - Education - - - General
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
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- Patrizia Ordine & Giuseppe Rose, 2011. "Educational Mismatch and Wait Unemployment," Working Papers 19, AlmaLaurea Inter-University Consortium.
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