Returns to Overeducation by College Major: Evidence from a Developing Country Turkey


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Eriş Dereli B.

in: Current Issues in Turkish Economy, Mahmut Tekçe,Çağlar Yurtseven, Editor, Peter Lang Publishing, Inc., Berlin, pp.25-44, 2019

  • Publication Type: Book Chapter / Chapter Research Book
  • Publication Date: 2019
  • Publisher: Peter Lang Publishing, Inc.
  • City: Berlin
  • Page Numbers: pp.25-44
  • Editors: Mahmut Tekçe,Çağlar Yurtseven, Editor

Abstract

This study uses the latest available 2017 Turkish Household Labor Force Surveys

and analyzes the incidence of and returns to overeducation by college major, where overeducation

indicates a position in which a worker’s education level is one standard deviation

above the average education level in her occupation. This chapter seeks to answer two

questions: Which college majors yield to greater incidence of overeducation? Do earnings

effects of being overeducated vary by college major? Two different specifications are

estimated to answer these questions. First, separate logit models for male and female are

estimated to see whether there are differences in the incidence of overeducation across

majors. The findings indicate that there are substantial differences. Most of the fields that

teach occupation-specific skills are observed not to yield high incidence of overeducation.

In addition, it is found that likelihood of overeducation decreases by age both for male and

female. Second, conditional earnings functions are estimated using quantile regressions to

see whether earnings differences of being overeducated exist and vary by college major. The

results reveal that there are earnings penalties of being overeducated and different college

majors lead to strikingly different earnings losses of being overeducated.