[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/ost/wpaper/347.html
   My bibliography  Save this paper

Education Mismatch, Human Capital and Labour Status of Young People across European Union Countries

Author

Listed:
  • Fabrizio Pompei

    (University of Perugia)

  • Ekaterina Selezneva
Abstract
This paper analyses the influence of country-level education mismatch on the individual-level relationship between education and the probability of being unemployed or staying in alternative labour statuses, for young people aged 15–34 in 2006, 2008 and 2010, living in 21 EU countries. We assume that young people may fall in five labour market statuses: 1) Employee;2) Self-employed; 3) Unemployed; 4) In Education; 5) Inactive, and perform a multinomial logit model to study the effects of years of education on relative probability of being in labour statuses 2, 3, 4, or 5, compared to the base category (Employee). Afterwards, we interact the individual-level years of education with a country-level indicator of education mismatch in order to identify the heterogeneous effects of the aggregate mismatch among people with different educational attainments. Results show that more years of education: i) reduce the relative probability of being unemployed; ii) have a cumulative effect by extending the period of education; iii) slightly raise the relative probability to be self-employed. As regards country-level education mismatch, we found that only after 2008 it produces an additional effect on better educated young people by further reducing their relative unemployment risk when it is compared to that of low educated youngsters. This outcome tells us that improving access to university degrees remains the main road to tackle youth unemployment caused by education mismatch, even after the outburst of the current financial and economic crisis.

Suggested Citation

  • Fabrizio Pompei & Ekaterina Selezneva, 2015. "Education Mismatch, Human Capital and Labour Status of Young People across European Union Countries," Working Papers 347, Leibniz Institut für Ost- und Südosteuropaforschung (Institute for East and Southeast European Studies).
    • Handle: RePEc:ost:wpaper:347
    as

    Download full text from publisher

    File URL: http://www.dokumente.ios-regensburg.de/publikationen/wp/wp_347.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Richard Desjardins & Kjell Rubenson, 2011. "An Analysis of Skill Mismatch Using Direct Measures of Skills," OECD Education Working Papers 63, OECD Publishing.
    2. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4, National Bureau of Economic Research, Inc.
    3. Francesco Pastore, 2012. "To Study or to Work?," Eastern European Economics, Taylor & Francis Journals, vol. 50(3), pages 49-78, May.
    4. Gianna Claudia Giannelli & Chiara Monfardini, 2003. "Joint decisions on household membership and human capital accumulation of youths. The role of expected earnings and local markets," Journal of Population Economics, Springer;European Society for Population Economics, vol. 16(2), pages 265-285, May.
    5. Trostel, Philip & Walker, Ian & Woolley, Paul, 2002. "Estimates of the economic return to schooling for 28 countries," Labour Economics, Elsevier, vol. 9(1), pages 1-16, February.
    6. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1.
    7. Riddell, W. Craig & Song, Xueda, 2011. "The impact of education on unemployment incidence and re-employment success: Evidence from the U.S. labour market," Labour Economics, Elsevier, vol. 18(4), pages 453-463, August.
    8. José Millán & Emilio Congregado & Concepción Román, 2012. "Erratum to: Determinants of self-employment survival in Europe," Small Business Economics, Springer, vol. 38(2), pages 259-263, February.
    9. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863, Elsevier.
    10. Christopher A. Pissarides, 2000. "Equilibrium Unemployment Theory, 2nd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262161877, April.
    11. Christopher A. Pissarides, 2013. "Unemployment in the Great Recession," Economica, London School of Economics and Political Science, vol. 80(319), pages 385-403, July.
    12. Christian Dustmann & Johannes Ludsteck & Uta Schönberg, 2009. "Revisiting the German Wage Structure," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 843-881.
    13. Kenneth Bollen & David Guilkey & Thomas Mroz, 1995. "Binary outcomes and endogenous explanatory variables: Tests and solutions with an application to the demand for contraceptive use in tunisia," Demography, Springer;Population Association of America (PAA), vol. 32(1), pages 111-131, February.
    14. Pfeiffer, Friedhelm & Seiberlich, Ruben R., 2009. "A socio-economic analysis of youth disconnectedness," ZEW Discussion Papers 09-070, ZEW - Leibniz Centre for European Economic Research.
    15. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    16. J. Scott Long & Jeremy Freese, 2006. "Regression Models for Categorical Dependent Variables using Stata, 2nd Edition," Stata Press books, StataCorp LP, edition 2, number long2, March.
    17. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, April.
    18. Nickell, Stephen, 1979. "Education and Lifetime Patterns of Unemployment," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 117-131, October.
    19. Sveinbjörn Blöndal & Simon Field & Nathalie Girouard, 2003. "Investment in human capital through upper-secondary and tertiary education," OECD Economic Studies, OECD Publishing, vol. 2002(1), pages 41-89.
    20. Parker, Simon C. & van Praag, C. Mirjam, 2006. "Schooling, Capital Constraints, and Entrepreneurial Performance: The Endogenous Triangle," Journal of Business & Economic Statistics, American Statistical Association, vol. 24, pages 416-431, October.
    21. Maarten Goos & Alan Manning, 2007. "Lousy and Lovely Jobs: The Rising Polarization of Work in Britain," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 118-133, February.
    22. L. Bryan, Mark & P. Jenkins, Stephen, 2013. "Regression analysis of country effects using multilevel data: a cautionary tale," ISER Working Paper Series 2013-14, Institute for Social and Economic Research.
    23. Philip Trostel & Ian Walker, 2006. "Education and Work," Education Economics, Taylor & Francis Journals, vol. 14(4), pages 377-399.
    24. Greene, William, 2010. "Testing hypotheses about interaction terms in nonlinear models," Economics Letters, Elsevier, vol. 107(2), pages 291-296, May.
    25. Jacob Mincer, 1991. "Education and Unemployment," NBER Working Papers 3838, National Bureau of Economic Research, Inc.
    26. Leuven, Edwin & Oosterbeek, Hessel, 2011. "Overeducation and Mismatch in the Labor Market," Handbook of the Economics of Education, in: Erik Hanushek & Stephen Machin & Ludger Woessmann (ed.), Handbook of the Economics of Education, edition 1, volume 4, chapter 0, pages 283-326, Elsevier.
    27. Pastore, Francesco, 2005. "To Study or to Work? Education and Labour Market Participation of Young People in Poland," IZA Discussion Papers 1793, Institute of Labor Economics (IZA).
    28. José Millán & Emilio Congregado & Concepción Román, 2012. "Determinants of self-employment survival in Europe," Small Business Economics, Springer, vol. 38(2), pages 231-258, February.
    29. Jacob Mincer, 1991. "Education and Unemployment of Women," NBER Working Papers 3837, National Bureau of Economic Research, Inc.
    30. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(3), pages 355-374.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pompei, Fabrizio & Selezneva, Ekaterina, 2021. "Unemployment and education mismatch in the EU before and after the financial crisis," Journal of Policy Modeling, Elsevier, vol. 43(2), pages 448-473.
    2. Angel de la Fuente & Juan Francisco Jimeno, 2004. "The private and fiscal returns to schooling and the effect of public policies on private incentives to invest in education: a general framework and some results for the EU," Working Papers 152, Barcelona School of Economics.
    3. Darragh Flannery & Cathal O'Donoghue, 2016. "Utilizing Microsimulation to Estimate the Private and Fiscal Returns to Education: Ireland 1987–2011," Manchester School, University of Manchester, vol. 84(1), pages 55-80, January.
    4. Darragh Flannery & Cathal O'Donoghue, 2012. "Utilising microsimulation to estimate new marginal returns to education: Ireland 1987-2011," Working Papers WP042012, University of Limerick, Department of Economics, revised Oct 2012.
    5. Theodore Koutmeridis, 2013. "The Market for "Rough Diamonds": Information, Finance and Wage Inequality," CDMA Working Paper Series 201307, Centre for Dynamic Macroeconomic Analysis, revised 14 Oct 2013.
    6. Ammermueller, Andreas & Kuckulenz, Anja & Zwick, Thomas, 2009. "Aggregate unemployment decreases individual returns to education," Economics of Education Review, Elsevier, vol. 28(2), pages 217-226, April.
    7. Fossen, Frank M. & Büttner, Tobias J.M., 2013. "The returns to education for opportunity entrepreneurs, necessity entrepreneurs, and paid employees," Economics of Education Review, Elsevier, vol. 37(C), pages 66-84.
    8. Garcia-Mainar, Inmaculada & Montuenga-Gomez, Victor M., 2005. "Education returns of wage earners and self-employed workers: Portugal vs. Spain," Economics of Education Review, Elsevier, vol. 24(2), pages 161-170, April.
    9. Saule Kemelbayeva, 2020. "Returns to schooling in Kazakhstan: an update using a pseudo-panel approach," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 10(3), pages 437-487, September.
    10. Falck, Oliver & Heimisch-Roecker, Alexandra & Wiederhold, Simon, 2021. "Returns to ICT skills," Research Policy, Elsevier, vol. 50(7).
    11. Jose Maria Millan & Emilio Congregado & Concepcion Roman & Mirjam van Praag & Andre van Stel, 2011. "The Value of an Educated Population for an Individual's Entrepreneurship Success," Tinbergen Institute Discussion Papers 11-066/3, Tinbergen Institute, revised 06 May 2014.
    12. Morsy, Hanan & Mukasa, Adamon, 2019. "Youth Jobs, Skill and Educational Mismatches in Africa," MPRA Paper 100394, University Library of Munich, Germany.
    13. Bonin, Holger, 2017. "The Potential Economic Benefits of Education of Migrants in the EU," IZA Research Reports 75, Institute of Labor Economics (IZA).
    14. Polachek, Solomon W., 2008. "Earnings Over the Life Cycle: The Mincer Earnings Function and Its Applications," Foundations and Trends(R) in Microeconomics, now publishers, vol. 4(3), pages 165-272, April.
    15. Colm Harmon & Hessel Oosterbeek & Ian Walker, 2003. "The Returns to Education: Microeconomics," Journal of Economic Surveys, Wiley Blackwell, vol. 17(2), pages 115-156, April.
    16. Lisa Grazzini, 2016. "The Importance of the Quality of Education: Some Determinants and its Effects on Earning Returns and Economic Growth," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2016(2), pages 43-82.
    17. Damon, Amy & Glewwe, Paul, 2011. "Valuing the benefits of the education provided by public universities: A case study of Minnesota," Economics of Education Review, Elsevier, vol. 30(6), pages 1242-1261.
    18. Nancy Kracke & Margarida Rodrigues, 2020. "A Task-Based Indicator for Labour Market Mismatch," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 149(2), pages 399-421, June.
    19. WILLIAMS Donald R., 2002. "Returns to education and experience in self-employment: Evidence from Germany," IRISS Working Paper Series 2002-04, IRISS at CEPS/INSTEAD.
    20. Wu, Na & Wang, Qunyong, 2018. "Wage penalty of overeducation: New micro-evidence from China," China Economic Review, Elsevier, vol. 50(C), pages 206-217.

    More about this item

    Keywords

    youth unemployment; education mismatch; multinomial logit mode;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ost:wpaper:347. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kseniia Gatskova (email available below). General contact details of provider: https://edirc.repec.org/data/osteide.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.