The mismatch of over-education and earnings in Spain: how big are differences?

Marta Pascual-Sáez and Paloma Lanza-Leon

Applied Economics, 2023, vol. 55, issue 46, 5369-5383

Abstract: This paper attempts to examine the incidence of over-education in Spain and to analyse the role over-education plays on an individual’s income distinguishing by gender. Following Freeman’s perspective, we can confirm over-education is due to an oversupply of qualified labour. We study over-education applying different matching techniques based on propensity score methods with microdata drawn from the European Statistics on Income and Living Conditions (EU-SILC, 2009–2019). Our results show that the incidence of over-education has increased over time and there exist huge differences by gender. Findings also demonstrate that over-education presents a negative effect on income. In fact, the real annual average earnings from over-educated women (men) can be approximately 7,000 (5,000) euros less than the average earnings of women (men) who were not over-educated. Policy implications are discussed in the light of the empirical results of our analysis.

Date: 2023
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DOI: 10.1080/00036846.2022.2139807

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