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Overeducation and earnings in the Australian graduate labour market: an application of the Vahey model

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  • Ian W. Li
  • Paul W. Miller

Abstract

This study explores the effects on earnings of overeducation, required education, and undereducation (ORU) in the Australian graduate labour market, using data from the 1999-2009 Graduate Destination Surveys. The Vahey [2000. "The Great Canadian Training Robbery: Evidence on the Returns to Educational Mismatch." Economics of Education Review 19 (2): 219-227] dummy variable specification, which permits an assessment of ORU earnings effects at different extents of educational mismatch, is adopted in the analysis. The findings reveal that while ORU earnings effects vary considerably across different extents of mismatch, earnings penalties were especially large in lower job categories. There is a strong tendency for earnings to follow jobs and for the distinction among types of university qualifications to lessen the more extensive the overeducation.

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  • Ian W. Li & Paul W. Miller, 2015. "Overeducation and earnings in the Australian graduate labour market: an application of the Vahey model," Education Economics, Taylor & Francis Journals, vol. 23(1), pages 63-83, February.
    • Handle: RePEc:taf:edecon:v:23:y:2015:i:1:p:63-83
    DOI: 10.1080/09645292.2013.772954
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    Cited by:

    1. Seamus McGuinness & Konstantinos Pouliakas & Paul Redmond, 2018. "Skills Mismatch: Concepts, Measurement And Policy Approaches," Journal of Economic Surveys, Wiley Blackwell, vol. 32(4), pages 985-1015, September.
    2. Chung‐Khain WYE & Rahmah ISMAIL, 2019. "The effects of ability on returns to over‐ and under‐education: Evidence from Malaysia," International Labour Review, International Labour Organization, vol. 158(3), pages 535-559, September.
    3. Ian W. Li & Mark Harris & Peter J. Sloane, 2018. "Vertical, Horizontal and Residual Skills Mismatch in the Australian Graduate Labour Market," The Economic Record, The Economic Society of Australia, vol. 94(306), pages 301-315, September.
    4. Denise Jackson, 2020. "Accounting and Finance Graduate Employment Outcomes: Underemployment, Self‐employment and Managing Diversity," Australian Accounting Review, CPA Australia, vol. 30(3), pages 193-205, September.
    5. Obbey Ahmed Elamin, 2018. "Impact of Informal Job-search on Wages for University Graduates in Egypt and Jordan," Working Papers 1272, Economic Research Forum, revised 19 Dec 2018.
    6. Ian Li & Andrew Williams & Ken Clements, 2023. "Labour Market Outcomes of Graduates in Economics in Australia," Economic Papers, The Economic Society of Australia, vol. 42(3), pages 306-323, September.

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