The Impact of Surplus Schooling on Earnings: Some Additional Findings II

No 08-04, Working Papers from Association Française de Cliométrie (AFC)

Abstract: This paper proposes a new statistical measure of the overeducation phenomenon. From Stochastic Production Frontiers (SPF), we use e¢ ciency score between schooling and earning to assess worker mismatches. Based on the French case, our measure reveals an overestimation of the overeducation extent, in comparison to the traditional measures.Following our econometric model, SPF approaches provide better estimation results on probit and earning function. Moreover, our approach shows that traditional measures overestimate also the wage penalties of overeducation. Thus, we point out that previous studies overestimate the dimishing returns of education and they have, conversely, understated the role of human capital.

Keywords: Overeducation; Stochastic Production Frontiers; Measurements (search for similar items in EconPapers)
JEL-codes: I2 J24 J3 (search for similar items in EconPapers)
Date: Written 2008

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