Unemployment or Overeducation: Which is a Worse Signal to Employers?

27 Pages Posted: 19 Jul 2014

See all articles by Stijn Baert

Stijn Baert

Ghent University; University of Antwerp; Catholic University of Louvain (UCL); Institute for the Study of Labor (IZA)

Dieter Verhaest

Hogeschool-Universiteit Brussel (HUBrussel)

Abstract

This study aims at estimating the stigma effect of unemployment and overeducation within one framework. To this end, we conduct a field experiment in the Belgian labour market. We send out trios of fictitious male job applications to real vacancies. These applications differ only by the labour market history of the candidates. By monitoring the subsequent reactions from the employer side, we find evidence for a larger stigma effect of unemployment than overeducation. The stigma effect of overeducation is found to occur for permanent contract jobs but not temporary ones.

Keywords: unemployment signalling, overeducation signalling, transitions in youth

JEL Classification: J24, J60, C93

Suggested Citation

Baert, Stijn and Verhaest, Dieter, Unemployment or Overeducation: Which is a Worse Signal to Employers?. IZA Discussion Paper No. 8312. Available at SSRN: https://ssrn.com/abstract=2468488

Stijn Baert (Contact Author)

Ghent University ( email )

University of Antwerp ( email )

Prinsstraat 13
Antwerp, Antwerp 2000
Belgium

HOME PAGE: http://https://www.uantwerpen.be/nl/personeel/stijn-baert/

Catholic University of Louvain (UCL) ( email )

Place Montesquieu, 3
Louvain-la-Neuve, 1348
Belgium

HOME PAGE: http://https://www.uclouvain.be/en-309318.html

Institute for the Study of Labor (IZA) ( email )

P.O. Box 7240
Bonn, D-53072
Germany

HOME PAGE: http://www.iza.org/en/webcontent/personnel/photos/index_html?key=6832

Dieter Verhaest

Hogeschool-Universiteit Brussel (HUBrussel) ( email )

Stormstraat 2
Brussels, 1000
Belgium

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