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Formal education, mismatch and wages after transition: Assessing the impact of unobserved heterogeneity using matching estimators

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  • Lamo, Ana
  • Messina, Julián

Abstract

This paper studies the incidence and consequences of the mismatch between formal education and the educational requirements of jobs in Estonia during the years 1997-2003. We find large wage penalties associated with the phenomenon of educational mismatch. Moreover, the incidence and wage penalty of mismatches increase with age. This suggests that structural educational mismatches can occur after fast transition periods. Our results are robust for various methodologies, and more importantly regarding departures from the exogeneity assumptions inherent in the matching estimators used in our analysis. JEL Classification: J0

Suggested Citation

  • Lamo, Ana & Messina, Julián, 2010. "Formal education, mismatch and wages after transition: Assessing the impact of unobserved heterogeneity using matching estimators," Working Paper Series 1215, European Central Bank.
  • Handle: RePEc:ecb:ecbwps:20101215
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Kampelmann, Stephan & Rycx, François, 2012. "The impact of educational mismatch on firm productivity: Evidence from linked panel data," Economics of Education Review, Elsevier, vol. 31(6), pages 918-931.
    2. Kiersztyn, Anna, 2013. "Stuck in a mismatch? The persistence of overeducation during twenty years of the post-communist transition in Poland," Economics of Education Review, Elsevier, vol. 32(C), pages 78-91.
    3. Bhatt, Rachana & Koedel, Cory & Lehmann, Douglas, 2013. "Is curriculum quality uniform? Evidence from Florida," Economics of Education Review, Elsevier, vol. 34(C), pages 107-121.
    4. Sattinger, Michael & Hartog, Joop, 2013. "Nash bargaining and the wage consequences of educational mismatches," Labour Economics, Elsevier, vol. 23(C), pages 50-56.
    5. Olga Kupets, 2015. "Education in transition and job mismatch: Evidence from the skills survey in non-EU transition economies," KIER Working Papers 915, Kyoto University, Institute of Economic Research.
    6. Patrizia Ordine & Giuseppe Rose, 2011. "Educational Mismatch and Wait Unemployment," Working Papers 19, AlmaLaurea Inter-University Consortium.
    7. Orbay, Benan & Aydede, Yigit, 2015. "Educational mismatch and the cost of underutilization in Turkish labour markets," MPRA Paper 65713, University Library of Munich, Germany.
    8. Patrizia Ordine & Giuseppe Rose, 2014. "Too Many Graduates? A Theory Of (Efficient) Educational Mismatch And Evidence From A Quasi-Natural Experiment," Working Papers 201409, Università della Calabria, Dipartimento di Economia, Statistica e Finanza "Giovanni Anania" - DESF.
    9. repec:spr:izamig:v:8:y:2018:i:1:d:10.1186_s40176-017-0114-2 is not listed on IDEAS
    10. Halvarsson, Daniel & Tingvall, Patrik, 2017. "The Impact of Employing Mismatched Workers on Firm Productivity, Wages and Profits," Ratio Working Papers 291, The Ratio Institute.
    11. Kupets, Olga, 2016. "Education-job mismatch in Ukraine: Too many people with tertiary education or too many jobs for low-skilled?," Journal of Comparative Economics, Elsevier, vol. 44(1), pages 125-147.
    12. repec:taf:edecon:v:25:y:2017:i:4:p:347-365 is not listed on IDEAS
    13. Olga Kupets, 2015. "Skill mismatch and overeducation in transition economies," IZA World of Labor, Institute for the Study of Labor (IZA), pages 224-224, December.

    More about this item

    Keywords

    Education mismatch; Matching Estimators; wage determination;

    JEL classification:

    • J0 - Labor and Demographic Economics - - General

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