Overeducation in Europe

Overeducation is one of the most important mechanisms for labour market adjustment when there is an excess supply of highly skilled workers. However, there is much debate about the consequences of this phenomena and the short- and long-term effects for both the overeducated worker and the economy as a whole. This book contributes to our understanding of recent developments in the research on overeducation by providing a detailed overview of the pertinent theoretical and policy issues. The authors study evidence that a substantial number of workers in Europe are overqualified and challenge the wisdom of greater investments in the education of the workforce. Although it may appear a waste of resources if many workers have a higher level of education than their job requires, others argue that overeducation may actually facilitate the development of a competitive and dynamic knowledge-based economy in Europe. They move on to look at labour mobility and skill mismatches in the labour market, and examine the impact of overeducation on earnings. They also address the somewhat controversial issue of how to measure employee overqualification, and propose an income ratio based on the difference between actual and potential earnings as an effective approach. Finally, they look at the effect of overeducation on specific groups in society such as licensed professionals, university graduates and ethnic minorities. Economists, social scientists, and academics interested in labour market theory and policy will find this an insightful and original volume which will make an important addition to the literature on overeducation.