Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/161022
Authors: 
Kampelmann, Stephan
Mahy, Benoît
Rycx, François
Vermeylen, Guillaume
Year of Publication: 
2016
Series/Report no.: 
IZA Discussion Papers 10399
Abstract: 
We provide first evidence regarding the direct effect of educational norms and educational mismatch on the bottom line of firms across work environments. To do so, we use rich Belgian linked employer-employee panel data, rely on the methodological approach pioneered by Hellerstein et al. (1999), and estimate dynamic panel data models at the firm level. Our findings show an 'inverted L' profitability profile: undereducation is associated with lower profits, whereas higher levels of normal and overeducation are correlated with positive economic rents of roughly the same magnitude. The size of these effects is amplified in firms experiencing economic uncertainty or operating in high-tech sectors.
Subjects: 
educational mismatch
productivity-wage gaps
linked panel data
JEL: 
J21
J24
Document Type: 
Working Paper

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