Abstract
We propose to evaluate the impact of education/skill mismatch through an extended version of Duncan and Hoffman equation and matching method by using the SWTS conducted by ILO for the main MENA region countries. Our empirical findings reveal that the youth labor market of these countries did not exhibit the same pattern of frictions. We find that Tunisian youth is more affected by over education phenomenon which implies the analysis of the return to education. More particularly, our findings show that concerning Egypt, Jordan and Tunisia, the marginal benefits that individuals expected to obtain at university level are significant. However, the return to education, especially for Tunisia, is largely attenuated when workers are overeducated. These findings suggest that over education introduces a wage penalty, which is more pronounced for Tunisian.
Highlights
Educational mismatch, and more over-education, remains a specific sensitive issue in developed countries
We propose to evaluate the impact of education/skill mismatch through an extended version of Duncan and Hoffman equation and matching method by using the School-to-Work Transition Survey (SWTS) conducted by International Labor Office (ILO) for the main MENA region countries
Verdugo and Verdugo (1989) adopt a modified version of Duncan and Hoffman (1981)’s model by substituting the years of schooling required by the job with the level of education attained by the individual, taking into account the wage penalty contracted by an individual for each year of over-education compared with another individual in the same position
Summary
Educational mismatch, and more over-education, remains a specific sensitive issue in developed countries. The annual report of European Commission (2013), reveals that Mediterranean countries are severely affected by educational mismatch, a fact largely due to the segmentation of the labor market, a large informal economy and an unequal unemployment distribution across groups and regions. We propose to develop, through an extended version of Duncan and Huffman specification and matching method, the empirical literature on return at education and to highlight the role of the overeducation to generate wages penalty, especially for university graduates. We can argue that the massification of higher education results in producing unemployed and overeducated workers, especially among university graduate This friction in the labor market, observed in Tunisia is creating a situation of too great wage disparity among young workers.
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