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The mismatch earnings penalty

Author

Listed:
  • Chiara Cavaglia

    (Centre for Vocational Education Research, London School of Economics)

  • Lindsey Macmillan

    (UCL Centre for Education Policy & Equalising Opportunities)

  • Konstantina Maragkou

    (Faculty of Education, University of Cambridge)

  • Richard Murphy

    (Department of Economics, University of Texas at Austin)

  • Gill Wyness

    (UCL Centre for Education Policy & Equalising Opportunities)

Abstract

We disentangle the relationship between student ability, course quality and the match between the two on earnings, estimating the first mismatch parameter in the literature. Using administrative data on all state-educated students in England linked to tax records, we show that high ability students attending low quality courses earn significantly less than their well-matched counterparts. By contrast, we find no evidence that lower ability students that overmatch to high quality courses go on to earn any less than well-matched students. This is evidence that affirmative action does not appear to have a detrimental effect on students’ future earnings.

Suggested Citation

  • Chiara Cavaglia & Lindsey Macmillan & Konstantina Maragkou & Richard Murphy & Gill Wyness, 2024. "The mismatch earnings penalty," CEPEO Working Paper Series 24-09, UCL Centre for Education Policy and Equalising Opportunities, revised Nov 2024.
    • Handle: RePEc:ucl:cepeow:24-09
    as

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    File URL: https://repec-cepeo.ucl.ac.uk/cepeow/cepeowp24-09.pdf
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    References listed on IDEAS

    as
    1. Eleanor Wiske Dillon & Jeffrey Andrew Smith, 2020. "The Consequences of Academic Match between Students and Colleges," Journal of Human Resources, University of Wisconsin Press, vol. 55(3), pages 767-808.
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    3. Stuart Campbell & Lindsey Macmillan & Richard Murphy & Gill Wyness, 2022. "Matching in the Dark? Inequalities in Student to Degree Match," Journal of Labor Economics, University of Chicago Press, vol. 40(4), pages 807-850.
    4. Ben Backes, 2012. "Do Affirmative Action Bans Lower Minority College Enrollment and Attainment?: Evidence from Statewide Bans," Journal of Human Resources, University of Wisconsin Press, vol. 47(2), pages 435-455.
    5. Susan Dynarski & CJ Libassi & Katherine Michelmore & Stephanie Owen, 2021. "Closing the Gap: The Effect of Reducing Complexity and Uncertainty in College Pricing on the Choices of Low-Income Students," American Economic Review, American Economic Association, vol. 111(6), pages 1721-1756, June.
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    8. Eleanor Wiske Dillon & Jeffrey Andrew Smith, 2017. "Determinants of the Match between Student Ability and College Quality," Journal of Labor Economics, University of Chicago Press, vol. 35(1), pages 45-66.
    9. Caroline M. Hoxby & Sarah Turner, 2015. "What High-Achieving Low-Income Students Know about College," American Economic Review, American Economic Association, vol. 105(5), pages 514-517, May.
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    More about this item

    Keywords

    mismatch; higher education; further education; returns;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy

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