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The Impact of Educational Mismatch on Firm Productivity: Evidence from Linked Panel Data

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  • Kampelmann, Stephan

    (Free University of Brussels)

  • Rycx, François

    (Free University of Brussels)

Abstract

We provide first evidence regarding the direct impact of educational mismatch on firm productivity. To do so, we rely on representative linked employer-employee panel data for Belgium covering the period 1999-2006. Controlling for simultaneity issues, time-invariant unobserved workplace characteristics, cohort effects and dynamics in the adjustment process of productivity, we find that: i) a higher level of required education exerts a significantly positive influence on firm productivity, ii) additional years of over-education (both among young and older workers) are beneficial for firm productivity, and iii) additional years of under-education (among young workers) are detrimental for firm productivity.

Suggested Citation

  • Kampelmann, Stephan & Rycx, François, 2012. "The Impact of Educational Mismatch on Firm Productivity: Evidence from Linked Panel Data," IZA Discussion Papers 7093, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp7093
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    More about this item

    Keywords

    linked panel data; productivity; educational mismatch; GMM;
    All these keywords.

    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

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