Wage Dispersion and Overqualification as Entailed by Reder Competition

Ekkehart Schlicht ()

No 2007-22, Economics Discussion Papers from Kiel Institute for the World Economy

Abstract: The expansion of higher education in theWestern countries has been accompanied by a marked widening of wage differentials and increasing overqualification. While the increase in wage differentials has been attributed to skill-biased technological change that made advanced skills scarce, this explanation does not fit well with the observed increase in overqualification which suggests that advanced skills are in excess supply. By ?Reder-competition? I refer to the simultaneous adjustment of wage offers and hiring standards in response to changing labor market condition. I present a simple model of Reder competition that reproduces the simultaneous increase in wage differentials and overqualification in response to an increase in education.

Keywords: Hiring standards; employment criteria; selection wages; efficiency wages; mobility; skillbiased technical change; overeducation; wage dispersion (search for similar items in EconPapers)
JEL-codes: D43 J63 J31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec
Date: 2007
View list of references

Downloads: (external link)
http://www.economics-ejournal.org/economics/discussionpapers/2007-22 (application/pdf)

Related works:
Working Paper: Wage Dispersion and Overqualification as Entailed by Reder Competition (2007)
Journal Article: Wage Dispersion, Over-Qualification, and Reder Competition (2007)
Journal Article: Wage Dispersion, Over-Qualification, and Reder Competition (2007)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:zbw:ifwedp:5727

Access Statistics for this paper

More papers in Economics Discussion Papers from Kiel Institute for the World Economy
Contact information at EDIRC.
Series data maintained by ZBW - German National Library for Economics ().