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Do the Higher Educated Unemployed Crowd Out the Lower Educated Ones in a Competition for Jobs?

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  • Cockx, Bart

    (Ghent University)

  • Dejemeppe, Muriel

    (Université catholique de Louvain)

Abstract

This paper proposes a new method to estimate the extent of job competition between workers with different schooling levels. We estimate the structural parameters of a matching function generalised to incorporate crowding out effects. We use flow data out of unemployment containing information on the level of educational attainment of the worker, but not on the level of schooling required by the employer for the job. The method therefore avoids the bias induced by mismeasurement in the educational requirements. Applied to Belgian data, we find evidence of significant crowding out among dismissed workers, particularly at the highest schooling levels.

Suggested Citation

  • Cockx, Bart & Dejemeppe, Muriel, 2002. "Do the Higher Educated Unemployed Crowd Out the Lower Educated Ones in a Competition for Jobs?," IZA Discussion Papers 541, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp541
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    References listed on IDEAS

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    1. A. Gautier, Pieter & J. van den Berg, Gerard & C. van Ours, Jan & Ridder, Geert, 2002. "Worker turnover at the firm level and crowding out of lower educated workers," European Economic Review, Elsevier, vol. 46(3), pages 523-538, March.
    2. Christopher A. Pissarides & Barbara Petrongolo, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June.
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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. Moreno-Galbis, E., 2006. "Unemployment and endogenous growth with new technologies-skill complementarity," Economic Modelling, Elsevier, vol. 23(2), pages 364-386, March.
    3. André D. Tsambou & Thierno Malick Diallo & Benjamin Fomba Kamga & Simplice A. Asongu, 2023. "Impact of Employment Support Programs on the Quality of Youth Employment: Evidence from Senegal's Internship Program," Working Papers 23/079, European Xtramile Centre of African Studies (EXCAS).
    4. François Rycx & Yves Saks & Ilan Tojerow, 2015. "Does Education Raise Productivity and Wages Equally? The Moderating Roles of Age, Gender and Industry," Working Paper Research 281, National Bank of Belgium.
    5. Batyra, Anna & Sneessens, Henri R., 2010. "Selective reductions in labor taxation: Labor market adjustments and macroeconomic performance," Journal of Policy Modeling, Elsevier, vol. 32(4), pages 531-543, July.
    6. Olivier, PIERARD, 2004. "Impact of Selective Reductions in Labor Taxation," LIDAM Discussion Papers IRES 2004035, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    7. Gabriele Cardullo & Bruno Van der Linden, 2007. "Employment Subsidies and Substitutable Skills: An Equilibrium Matching Approach," Applied Economics Quarterly (formerly: Konjunkturpolitik), Duncker & Humblot, Berlin, vol. 53(4), pages 375-404.
    8. Olivier, Pierrard & Henri R., Sneessens, 2002. "Low-Skilled Unemployment, Biased Technological Shocks and Job Competition," LIDAM Discussion Papers IRES 2003014, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES), revised 03 May 2002.
    9. Holger Bonin & Wolfram Kempe & Hilmar Schneider, 2003. "Kombilohn oder Workfare?: Zur Wirksamkeit zweier arbeitsmarktpolitischer Strategien," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 72(1), pages 51-67.
    10. E. Moreno-Galbis & Henri Sneessens, 2007. "Low-skilled unemployment, capital-skill complementarity and embodied technical progress," Recherches économiques de Louvain, De Boeck Université, vol. 73(3), pages 241-272.
    11. Olivier Pierrard & Henri Sneessens, 2004. "Biased Technological Shocks, Wage Rigidities and Low-Skilled Unemployment," DNB Working Papers 020, Netherlands Central Bank, Research Department.
    12. Stephan Kampelmann & François Rycx & Yves Saks & Ilan Tojerow, 2018. "Does education raise productivity and wages equally? The moderating role of age and gender," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 7(1), pages 1-37, December.
    13. Julia Bock-Schappelwein & Ulrike Huemer & Andrea Pöschl, 2006. "Teilstudie 9: Aus- und Weiterbildung als Voraussetzung für Innovation," WIFO Studies, WIFO, number 27448, February.
    14. Marie Duvivier & Maritza López-Novella, 2015. "Working Paper 10-15 - The relationship between unemployment duration and education - The case of school leavers in Belgium," Working Papers 1510, Federal Planning Bureau, Belgium.
    15. Schwartz Jeremy, 2020. "Job competition, human capital, and the lock-in effect: can unemployment insurance efficiently allocate human capital," The B.E. Journal of Macroeconomics, De Gruyter, vol. 20(1), pages 1-23, January.
    16. Eva, MORENO-GALBIS, 2004. "Unemployment and Endogenous Growth with Capital-Skill Complementarity," LIDAM Discussion Papers IRES 2004001, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).

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    More about this item

    Keywords

    job competition; crowding out; overeducation; matching function; duration analysis;
    All these keywords.

    JEL classification:

    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies

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