Educational Mismatch and Wait Unemployment

This work investigates educational mismatch and its interrelationships with individual unemployment duration. Bystudying unemployment histories of Italian workers we show that overeducated have longer unemployment spells thanwell matched workers. Using duration models we show that hazard rates of graduates are higher than those ofundergraduates only for transitions toward occupations that require the competencies provided by the universities. Thisprocess is strictly related to innate ability and geographical location. Our findings are consistent with an interpretationof educational mismatch as a penalizing phenomenon in the individuals' working life associated to long termunemployment. We argue that a policy that gives more relevance to individual ability in the schooling attainment mayreduce educational mismatch.