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The Effects of Over-Education on Earnings in the Graduate Labour Market

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  • Mary Silles
  • Peter Dolton

Abstract

The massive transition to higher education and the large number of university graduates taking school-leavers` jobs has led many to question the widely held view that a university education is a good investment and a guarantee of economic success. This paper using data from one large civic university in the UK to consider the determinants and consequences of over-education. Approximately one in five graduates genuinely have more education than their jobs require. This study tests and rejects the hypothesis of non-random selection into over-education among graduates who have been in the labour market for some time. In addition, the evidence strongly suggests that ordinary least squares systematically underestimate the magnitude of the negative effects of over-education of earnings.

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Bibliographic Info

Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 126.

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Date of creation: 01 Nov 2002
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Handle: RePEc:oxf:wpaper:126

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Web page: http://www.economics.ox.ac.uk/
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Keywords: educational economics; wage differentials;

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