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Education-occupation mismatch: Is there an income penalty?

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  • Nordin, Martin
  • Persson, Inga
  • Rooth, Dan-Olof

Abstract

This paper adds to the sparse literature on the consequences of education-occupation mismatches. It examines the income penalty for field of education-occupation mismatches for men and women with higher education degrees in Sweden and reveals that the penalty for such mismatches is large for both men and women. For mismatched men the income penalty is about twice as large as that found for US men, whereas for women the penalty is of about the same size as for US women. Controlling for cognitive ability further establishes that the income penalty is not caused by a sorting by ability, at least for Swedish men. The income penalty for men decreases with work experience, which is an indication that education-specific skills and work experience are substitutes to some extent.

Suggested Citation

  • Nordin, Martin & Persson, Inga & Rooth, Dan-Olof, 2010. "Education-occupation mismatch: Is there an income penalty?," Economics of Education Review, Elsevier, vol. 29(6), pages 1047-1059, December.
  • Handle: RePEc:eee:ecoedu:v:29:y:2010:i:6:p:1047-1059
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    References listed on IDEAS

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    Keywords

    Human capital Rate of return Salary wage differentials Educational economics;

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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