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Informality, Education-Occupation Mismatch, and Wages: Evidence from India

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Listed:
  • Bahl, Shweta
  • Sharma, Ajay
Abstract
This article examines the intertwining relationship between informality and education-occupation mismatch (EOM) and the consequent impact on the workers' wages. In particular, we discuss two issues - first, the relative importance of informality and education-occupation mismatch in determining the wages; and second, the relevance of EOM for formal and informal workers. The analysis reveals that although both informality and EOM are significant determinants of wages, the former is more crucial for a developing country like India. Further, we find that EOM is one of the crucial determinants of wages for formal workers, but it is not critical for informal workers. The study highlights the need for considering the bifurcation of formal-informal workers to understand the complete dynamics of EOM especially for developing countries where informality is predominant.

Suggested Citation

  • Bahl, Shweta & Sharma, Ajay, 2023. "Informality, Education-Occupation Mismatch, and Wages: Evidence from India," GLO Discussion Paper Series 1241, Global Labor Organization (GLO).
    • Handle: RePEc:zbw:glodps:1241
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    Cited by:

    1. Cedrick Kalemasi Mosengo & Christian Zamo Akono, 2024. "Effect of Informal Employment on Overeducation in Developing Countries with a focus on the Democratic Republic of Congo (DRC)," Working Papers 24/004, European Xtramile Centre of African Studies (EXCAS).
    2. Cedrick Kalemasi Mosengo & Christian Zamo Akono, 2024. "Effect of Informal Employment on Overeducation in Developing Countries with a focus on the Democratic Republic of Congo (DRC)," Working Papers of the African Governance and Development Institute. 24/004, African Governance and Development Institute..

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    More about this item

    Keywords

    Informality; Education-Occupation Mismatch; India;
    All these keywords.

    JEL classification:

    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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