publication . Research . Preprint . 2013

Wage effects of job-worker mismatches: Heterogeneous skills or institutional effects?

Allen J.P.; Velden R.K.W. van der; Badillo-Amador L.;
Open Access English
  • Published: 01 Jan 2013
  • Publisher: Maastricht University, Graduate School of Business and Economics
  • Country: Netherlands
Abstract
The strong wage effects related to mismatches between a worker’s education and that required in the job are usually attributed to assignment theory. This theory asserts that productivity and wages depend on the education-job match, which determines the utilization of skills. However, recent research shows that educational mismatches are only weakly related to skill utilization, which in any case fails to account for the bulk of the wage effects. Two alternative theories have been put forward to explain the observed wage effects. One points to wage setting institutions that cause wages to be based on job characteristics regardless of individual performance, the o...
Subjects
free text keywords: General; [Wage Level and Structure; Wage Differentials; Public Sector Labor Markets; Labor-Management Relations, Trade Unions, and Collective Bargaining], 2 International, jel:J31, jel:J45, jel:J50
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