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Overqualification, job dissatisfaction, and increasing dispersion in the returns to graduate education

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  • Francis Green
  • Yu Zhu

Abstract

We report increasing dispersion in the returns to graduate education in Britain, and relate this development to rising overqualification. We distinguish 'Real' and 'Formal' overqualification, according to whether it is accompanied by underutilization of skill. Employees in the former group experience greater, and more sharply rising, pay penalties than those in the latter group. Real Overqualification, but not Formal Overqualification, is associated with job dissatisfaction. While Formal Overqualification has been increasing over time, Real Overqualification has been steady or rising only slowly. The normative implication drawn is that the state should provide regular information on the distribution of the returns to graduate education. Copyright 2010 Oxford University Press 2010 All rights reserved, Oxford University Press.

Suggested Citation

  • Francis Green & Yu Zhu, 2010. "Overqualification, job dissatisfaction, and increasing dispersion in the returns to graduate education," Oxford Economic Papers, Oxford University Press, vol. 62(4), pages 740-763, October.
    • Handle: RePEc:oup:oxecpp:v:62:y:2010:i:4:p:740-763
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    References listed on IDEAS

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    1. Arnaud Chevalier & Joanne Lindley, 2009. "Overeducation and the skills of UK graduates," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 172(2), pages 307-337, April.
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    4. Dolton, Peter & Vignoles, Anna, 2000. "The incidence and effects of overeducation in the U.K. graduate labour market," Economics of Education Review, Elsevier, vol. 19(2), pages 179-198, April.
    5. Gallie, Duncan & White, Michael & Cheng, Yuan & Tomlinson, Mark, 1998. "Restructuring the Employment Relationship," OUP Catalogue, Oxford University Press, number 9780198294412.
    6. Daron Acemoglu, 1998. "Why Do New Technologies Complement Skills? Directed Technical Change and Wage Inequality," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(4), pages 1055-1089.
    7. Frenette, Marc, 2004. "The overqualified Canadian graduate: the role of the academic program in the incidence, persistence, and economic returns to overqualification," Economics of Education Review, Elsevier, vol. 23(1), pages 29-45, February.
    8. Andy Dickerson & Francis Green, 2004. "The growth and valuation of computing and other generic skills," Oxford Economic Papers, Oxford University Press, vol. 56(3), pages 371-406, July.
    9. Ian Walker & Yu Zhu, 2007. "The College Wage Premium, Overeducation, and the Expansion of Higher Education in the UK by and," Working Papers 200720, Geary Institute, University College Dublin.
    10. Walker, Ian & Zhu, Yu, 2005. "The College Wage Premium, Overeducation, and the Expansion of Higher Education in the UK," IZA Discussion Papers 1627, Institute of Labor Economics (IZA).
    11. Francis Green & Steven McIntosh, 2007. "Is there a genuine under-utilization of skills amongst the over-qualified?," Applied Economics, Taylor & Francis Journals, vol. 39(4), pages 427-439.
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    More about this item

    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
    • J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy

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