IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

“Double Penalty in Returns to Education: Informality and Educational Mismatch in the Colombian Labour market”

  • Paula Herrera

    ()

    (Faculty of Economics, University of Barcelona)

  • Enrique López-Bazo

    ()

    (Faculty of Economics, University of Barcelona)

  • Elisabet Motellón

    ()

    (Faculty of Economics, University of Barcelona)

This paper examines the returns to education taking into consideration the existence of educational mismatches in the formal and informal employment of a developing country. Results show that the returns of surplus, required and deficit years of schooling are different in the two sectors. Moreover, they suggest that these returns vary along the wage distribution, and that the pattern of variation differs for formal and informal workers. In particular, informal workers face not only lower returns to their education, but suffer a second penalty associated with educational mismatches that puts them at a greater disadvantage compare to their formal counterparts.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.ub.edu/irea/working_papers/2013/201307.pdf
Download Restriction: no

Paper provided by University of Barcelona, Research Institute of Applied Economics in its series IREA Working Papers with number 201307.

as
in new window

Length: 32 pages
Date of creation: May 2013
Date of revision: May 2013
Handle: RePEc:ira:wpaper:201307
Contact details of provider: Postal: Tinent Coronel Valenzuela, Num 1-11 08034 Barcelona
Web page: http://www.ub.edu/irea/

More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
  2. Günther, Isabel & Launov, Andrey, 2012. "Informal employment in developing countries," Journal of Development Economics, Elsevier, vol. 97(1), pages 88-98.
  3. Bosch, Mariano & Maloney, William F., 2010. "Comparative analysis of labor market dynamics using Markov processes: An application to informality," Labour Economics, Elsevier, vol. 17(4), pages 621-631, August.
  4. Fernando Botelho & Vladimir Ponczek, 2011. "Segmentation in the Brazilian Labor Market," Economic Development and Cultural Change, University of Chicago Press, vol. 59(2), pages 437 - 463.
  5. Guillermo E. Perry & William F. Maloney & Omar S. Arias & Pablo Fajnzylber & Andrew D. Mason & Jaime Saavedra-Chanduvi, 2007. "Informality : Exit and Exclusion," World Bank Publications, The World Bank, number 6730, October.
  6. Duncan, Greg J. & Hoffman, Saul D., 1981. "The incidence and wage effects of overeducation," Economics of Education Review, Elsevier, vol. 1(1), pages 75-86, February.
  7. Buchel, Felix & van Ham, Maarten, 2003. "Overeducation, regional labor markets, and spatial flexibility," Journal of Urban Economics, Elsevier, vol. 53(3), pages 482-493, May.
  8. Angel López-Nicolás & Jaume García & Pedro J. Hernández, 2001. "How wide is the gap? An investigation of gender wage differences using quantile regression," Empirical Economics, Springer, vol. 26(1), pages 149-167.
  9. Maria Tannuri-Pianto & Donald Pianto, 2004. "Informal employment in Bolivia: A lost proposition?," Econometric Society 2004 Latin American Meetings 149, Econometric Society.
  10. Luis Eduardo Arango & Paula Herrera & Carlos Esteban Posada, 2007. "El salario mínimo: aspectos generales sobre los casos de Colombia y otros paises," BORRADORES DE ECONOMIA 002544, BANCO DE LA REPÚBLICA.
  11. Fields, Gary S., 1975. "Rural-urban migration, urban unemployment and underemployment, and job-search activity in LDCs," Journal of Development Economics, Elsevier, vol. 2(2), pages 165-187, June.
  12. Camilo Mondragón-Vélez & Ximena Peña & Daniel Wills, 2010. "Labor Market Rigidities and Informality in Colombia," ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION, ECONOMIA JOURNAL OF THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION.
  13. Leuven, Edwin & Oosterbeek, Hessel, 2011. "Overeducation and Mismatch in the Labor Market," IZA Discussion Papers 5523, Institute for the Study of Labor (IZA).
  14. Pradhan, Menno & van Soest, Arthur, 1995. "Formal and informal sector employment in urban areas of Bolivia," Labour Economics, Elsevier, vol. 2(3), pages 275-297, September.
  15. Weiwei Ren & Paul W. Miller, 2012. "Gender Differentials in the Payoff to Schooling in Rural China," Journal of Development Studies, Taylor & Francis Journals, vol. 48(1), pages 133-150, September.
  16. Chiswick, Barry R. & Miller, Paul W., 2005. "Why Is the Payoff to Schooling Smaller for Immigrants?," IZA Discussion Papers 1731, Institute for the Study of Labor (IZA).
  17. Magnac, Th, 1991. "Segmented or Competitive Labor Markets," Econometrica, Econometric Society, vol. 59(1), pages 165-87, January.
  18. Maloney, William F, 1999. "Does Informality Imply Segmentation in Urban Labor Markets? Evidence from Sectoral Transitions in Mexico," World Bank Economic Review, World Bank Group, vol. 13(2), pages 275-302, May.
  19. Sicherman, Nachum, 1991. ""Overeducation" in the Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 9(2), pages 101-22, April.
  20. Séamus McGuinness, 2006. "Overeducation in the Labour Market," Journal of Economic Surveys, Wiley Blackwell, vol. 20(3), pages 387-418, 07.
  21. Hartog, Joop & Oosterbeek, Hessel, 1988. "Education, allocation and earnings in the Netherlands: 0verschooling?," Economics of Education Review, Elsevier, vol. 7(2), pages 185-194, April.
  22. Amaral, Pedro S. & Quintin, Erwan, 2006. "A competitive model of the informal sector," Journal of Monetary Economics, Elsevier, vol. 53(7), pages 1541-1553, October.
  23. Pratap, Sangeeta & Quintin, Erwan, 2006. "Are labor markets segmented in developing countries? A semiparametric approach," European Economic Review, Elsevier, vol. 50(7), pages 1817-1841, October.
  24. Mendes de Oliveira, M. & Santos, M. C. & Kiker, B. F., 2000. "The role of human capital and technological change in overeducation," Economics of Education Review, Elsevier, vol. 19(2), pages 199-206, April.
  25. Moshe Buchinsky, 1998. "The dynamics of changes in the female wage distribution in the USA: a quantile regression approach," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 13(1), pages 1-30.
  26. Aysit Tansel, 1999. "Formal Versus Informal Sector Choice of Wage Earners and their Wages in Turkey," Working Papers 9927, Economic Research Forum, revised Sep 1999.
  27. Gong, Xiaodong & van Soest, Arthur, 2001. "Wage Differentials and Mobility in the Urban Labor Market: A Panel Data Analysis for Mexico," IZA Discussion Papers 329, Institute for the Study of Labor (IZA).
  28. Jim Albrecht & Aico van Vuuren & Susan Vroman, 2007. "Counterfactual Distributions with Sample Selection Adjustments: Econometric Theory and an Application to the Netherlands," Working Papers gueconwpa~07-07-06, Georgetown University, Department of Economics.
  29. Arnaud Chevalier, 2003. "Measuring Over-education," Economica, London School of Economics and Political Science, vol. 70(279), pages 509-531, 08.
  30. McGoldrick, KimMarie & Robst, John, 1996. "Gender Differences in Overeducation: A Test of the Theory of Differential Overqualification," American Economic Review, American Economic Association, vol. 86(2), pages 280-84, May.
  31. Mehta, Aashish & Felipe, Jesus & Quising, Pilipinas & Camingue, Sheila, 2011. "Overeducation in developing economies: How can we test for it, and what does it mean?," Economics of Education Review, Elsevier, vol. 30(6), pages 1334-1347.
  32. Bauer, Thomas K., 2002. "Educational mismatch and wages: a panel analysis," Economics of Education Review, Elsevier, vol. 21(3), pages 221-229, June.
  33. Kiker, B. F. & Santos, Maria C. & de Oliveira, M. Mendes, 1997. "Overeducation and undereducation: Evidence for Portugal," Economics of Education Review, Elsevier, vol. 16(2), pages 111-125, April.
  34. Dolton, Peter & Vignoles, Anna, 2000. "The incidence and effects of overeducation in the U.K. graduate labour market," Economics of Education Review, Elsevier, vol. 19(2), pages 179-198, April.
  35. Michael Quinn & Stephen Rubb, 2005. "The importance of education-occupation matching in migration decisions," Demography, Springer, vol. 42(1), pages 153-167, February.
  36. Richard R. Verdugo & Naomi Turner Verdugo, 1989. "The Impact of Surplus Schooling on Earnings: Some Additional Findings," Journal of Human Resources, University of Wisconsin Press, vol. 24(4), pages 629-643.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:ira:wpaper:201307. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Alicia García)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.