Sholeh Maani, University of Auckland - Over-education, Country of Highest Qualification, and Immigrant Earnings: Insights from a Penalised Quantile Panel Regression Analysis.

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Title: Over-education, Country of Highest Qualification, and Immigrant Earnings: Insights from a Penalised Quantile
Panel Regression Analysis.

Abstract: The recent literature on overeducation has provided divergent results on whether or not overeducation bears an earnings penalty. In addition, few studies have considered overeducation among immigrants. This paper uses panel data analyses to investigate the match between education and occupation and resulting earnings effects for immigrants from English Speaking, and Non-English Speaking, Backgrounds relative to the native-born population in Australia. Based on nine years of longitudinal data (HILDA), the panel approach addresses individual heterogeneity effects (motivation, ability, and compensating differentials) that are crucial in overeducation analysis. First, we find that immigrants have significantly higher incidence rates of overeducation than the native-born. This probability increases, rather than diminishes, once we control for unobserved correlated effects. In addition, NESB immigrants receive a lower return to required and overeducation compared to the other groups.
We further apply penalised quantile panel regression analysis with controls for overseas country of highest qualification to examine potential variations of earnings penalties for job-mismatched workers across the earnings distribution.  We find that the earnings penalties are highest for NESB job mismatched immigrants with overseas highest qualifications and that the penalty increases at the higher earnings quantiles

Presenter: Sholeh Maani, University of Auckland

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