Do you really need it? Educational mismatch and earnings in Ghana

Abstract

This study examines the effects of educational mismatch on earnings using cross-sectional data from three rounds of the Ghana Living Standards Survey. There are gender-earnings differentials, with women suffering a penalty for undereducation that is almost twice that paid by men for having less than the required years of education, although the premium associated with overeducation is higher for women. While the penalty associated with deficit schooling decreases for men over time, this penalty increases for women. Women but not men experience significant increases in returns for attaining the required education. On the contrary, the lack of significance of returns to overeducation over time suggests that human capital beyond the required level is unproductive and may represent a waste of public resources.