Job-schooling mismatch and wages have received extensive attention from economists in developed countries over the last two decades. Empirical evidence reveals incidence of ORU (overeducation, required education, and undereducation) across countries in different periods, as well as estimates of their returns. This paper, using personnel records of a large Brazilian manufacturing plant, joins a recent wave of empirical work that focus on deeper questions: (i) Are ORU returns a firm wage effect? (ii) Do ORU returns remain significant after controlling for unobserved workers heterogeneity? (iii) Is overeducation a deliberate investment decision of workers in their careers? Our outcomes suggest that overeducation is an investment decision of young workers in their careers.
Education; Wages; Overeducation
