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The Effects of Over-Education on Earnings in the Graduate Labour Market

Author

Listed:
  • Mary Silles
  • Peter Dolton
  • Department of Economics
  • University of Newcastle

Abstract

The massive transition to higher education and the large number of university graduates taking school-leavers` jobs has led many to question the widely held view that a university education is a good investment and a guarantee of economic success. This paper using data from one large civic university in the UK to consider the determinants and consequences of over-education. Approximately one in five graduates genuinely have more education than their jobs require. This study tests and rejects the hypothesis of non-random selection into over-education among graduates who have been in the labour market for some time. In addition, the evidence strongly suggests that ordinary least squares systematically underestimate the magnitude of the negative effects of over-education of earnings.

Suggested Citation

  • Mary Silles & Peter Dolton & Department of Economics & University of Newcastle, 2002. "The Effects of Over-Education on Earnings in the Graduate Labour Market," Economics Series Working Papers 126, University of Oxford, Department of Economics.
    • Handle: RePEc:oxf:wpaper:126
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    More about this item

    Keywords

    educational economics; wage differentials;

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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