Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/27722
Authors: 
Schlicht, Ekkehart
Year of Publication: 
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
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

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