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Educational and Skills Mismatches: Unravelling Their Effects on Wages Across Europe

Author

Listed:
  • Loredana Cultrera

    (University of Mons (UMONS - Belgium), Soci&ter and Risk)

  • Benoît Mahy

    (University of Mons (UMONS - Belgium), Soci&ter, and DULBEA)

  • François Rycx

    (Université libre de Bruxelles (CEBRIG and DULBEA), GLO, IRES, IZA, Soci&ter)

  • Guillaume Vermeylen

    (University of Mons (UMONS - Belgium), Soci&ter, DULBEA and CEB.)

Abstract

This paper is among the firsts to investigate the impact of overeducation and overskilling on workers’ wages using a unique pan-European database covering twenty-eight countries for the year 2014, namely the CEDEFOP’s European Skills and Jobs (ESJ) survey. Overall, the results suggest a wage penalty associated with overeducation. When interacting educational mismatch with skills mismatch into apparent overeducation and genuine overeducation, the results suggest that the highest wage penalty is reached for workers that are both overeducated and overskilled.

Suggested Citation

  • Loredana Cultrera & Benoît Mahy & François Rycx & Guillaume Vermeylen, 2022. "Educational and Skills Mismatches: Unravelling Their Effects on Wages Across Europe," LIDAM Discussion Papers IRES 2022008, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:2022008
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    File URL: https://sites.uclouvain.be/econ/DP/IRES/2022008.pdf
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    References listed on IDEAS

    as
    1. Allen, Jim & van der Velden, Rolf, 2001. "Educational Mismatches versus Skill Mismatches: Effects on Wages, Job Satisfaction, and On-the-Job Search," Oxford Economic Papers, Oxford University Press, vol. 53(3), pages 434-452, July.
    2. Marco Pecoraro, 2014. "Is There Still a Wage Penalty for Being Overeducated But Well-matched in Skills? A Panel Data Analysis of a Swiss Graduate Cohort," LABOUR, CEIS, vol. 28(3), pages 309-337, September.
    3. Michele Pellizzari & Anne Fichen, 2013. "A New Measure of Skills Mismatch: Theory and Evidence from the Survey of Adult Skills (PIAAC)," OECD Social, Employment and Migration Working Papers 153, OECD Publishing.
    4. Marco Pecoraro, 2016. "The incidence and wage effects of overeducation using the vertical and horizontal mismatch in skills," International Journal of Manpower, Emerald Group Publishing Limited, vol. 37(3), pages 536-555, June.
    5. Frenette, Marc, 2004. "The overqualified Canadian graduate: the role of the academic program in the incidence, persistence, and economic returns to overqualification," Economics of Education Review, Elsevier, vol. 23(1), pages 29-45, February.
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    Cited by:

    1. Sayoree Gooptu & Vivekananda Mukherjee, 2023. "School dropout and overeducation in developing economies: Feasibility of a budgetary solution†," Review of Development Economics, Wiley Blackwell, vol. 27(2), pages 825-852, May.

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    More about this item

    Keywords

    Educational mismatch; Skills mismatch; Wages; European survey;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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