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Title:Wage Dispersion, Over-Qualification, and Reder Competition PDF Logo
Authors:Schlicht, Ekkehart
Issue Date:2007
Citation:[Journal:] Economics: The Open-Access, Open-Assessment E-Journal [Volume:] 1 [Issue:] 2007-13 (Version 2) [Pages:] 1-22 [URL:] http://www.economics-ejournal.org/economics/journalarticles/2007-13
Series/Report no.:Economics - The Open-Access, Open-Assessment E-Journal 2007-13 [rev.]
Abstract:The expansion of higher education in the Western countries has been accompanied by a marked widening of wage differentials and increasing over-qualification. While the increase in wage differentials has been attributed to skill-biased technological change that made advanced skills scarce, this explanation does not fit well with the observed increase in over-qualification which suggests that advanced skills are in excess supply. By "Reder-competition" I refer to the simultaneous adjustment of wage offers and hiring standards in response to changing labor market conditions. I present a simple model of Reder competition that depicts wages as driven by labor heterogeneity, rather than scarcity. The mechanism may give rise to a simultaneous increase in wage differentials and over-qualification.
Subjects:Hiring standards
employment criteria
selection wages
efficiency wages
mobility
skillbiased technological change
heterogeneity-biased technological change
over-qualification
over-education
wage dispersion
Reder competition
JEL:J31
J63
D43
Creative Commons License:http://creativecommons.org/licenses/by-nc/2.0/de/deed.en
Document Type:Article
Appears in Collections:Economics: The Open-Access, Open-Assessment E-Journal - Journal Articles

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