In Search of a Better Match: Qualification Mismatches in Developing Asia

Publication | February 2016
In Search of a Better Match: Qualification Mismatches in Developing Asia

Using new data from several low-income economies in urban Asia we find that overeducation in less developed labor markets are more pervasive than in more developed economies.

This paper examines the extent to which various factors explains talent misallocation in the form of qualification mismatches across six urban developing Asian economies using the World Bank’s Skills towards Employability and Productivity (STEP) Skills Measurement Survey. Frictions related to search costs are a crucial determinant of match quality resulting in socially inefficient talent misallocation. Findings suggest scope for policy interventions that improve worker-job matches with potential gains to wages and aggregate productivity.

Contents 

  • Tables and Figures
  • Abstract
  • Introduction
  • Data
  • The Role of Search: Empirical Evidence
  • Qualification Mismatch and Wages
  • Conclusion
  • References