Who is overeducated and why? Probit and dynamic mixed multinomial logit analyses of vertical mismatch in East and West Germany

Christina Boll, Julian Leppin and Klaus Schömann

Education Economics, 2016, vol. 24, issue 6, 639-662

Abstract: Overeducation potentially signals a productivity loss. With Socio-Economic Panel data from 1984 to 2011 we identify drivers of educational mismatch for East and West medium and highly educated Germans. Addressing measurement error, state dependence and unobserved heterogeneity, we run dynamic mixed multinomial logit models for three different measures of educational mismatch. We find that overeducation is mainly state dependent. Results largely hinge on the selected specification. Yet, robust results are that employment experience decreases and past unemployment increases the mismatch risk. An employer change seldomly serves as a suitable escape strategy, nor does a dual qualification save graduates from entering overeducation.

Date: 2016
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Related works:
Working Paper: Who Is Overeducated and Why?: Probit and Dynamic Mixed Multinomial Logit Analyses of Vertical Mismatch in East and West Germany (2014)
Working Paper: Who is overeducated and why? Probit and dynamic mixed multinomial logit analyses of vertical mismatch in East and West Germany (2014)
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DOI: 10.1080/09645292.2016.1158787

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