Overeducation, earnings and job satisfaction among graduates in China

Melanie Jones, Ezgi Kaya and Jiarui Nan

China Economic Review, 2025, vol. 93, issue C

Abstract: Using nationally representative longitudinal data from the China Family Panel Studies (2014–2020), this paper examines the relationship between overeducation, earnings and job satisfaction among graduates in China. We find consistent evidence of wage and job satisfaction penalties across multiple established measures of overeducation, even after accounting for personal and work-related characteristics. Although widely discussed in the literature, differences in academic subject and cognitive and non-cognitive skills account for only a modest part of the pay penalty. Controlling for time-invariant unobserved heterogeneity reduces the size of overeducation pay penalties and, in several cases, removes their statistical significance, suggesting the role of other forms of unobserved individual heterogeneity.

Keywords: Overeducation; China; Earnings; Job satisfaction; Cognitive and non-cognitive skills; Unobserved heterogeneity (search for similar items in EconPapers)
JEL-codes: J24 J28 J31 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:93:y:2025:i:c:s1043951x25001063

DOI: 10.1016/j.chieco.2025.102448

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