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Education, Mismatch and Unemployment

newdigital Education, Mismatch and Unemployment
Article
journal RIVISTA INTERNAZIONALE DI SCIENZE SOCIALI
issue RIVISTA INTERNAZIONALE DI SCIENZE SOCIALI - 2019 - 3
title Education, Mismatch and Unemployment
authors
publisher Vita e Pensiero
format Article | Pdf
online since 11-2019
doi 10.26350/000518_0034
issn 0035-676X (print) | 1827-7918 (digital)
€ 6.00

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We study an economy where the labour market is plagued with search imperfections and is segmented along a set of professions. To enter a profession, workers need to undertake a specific educational investment. At the time of the investment, however, workers are imperfectly informed on the outlook offered by any profession as they only observe a private and a public signal concerning this outlook. We show that imperfect information induces misallocation of labour across professions and increases the rate of unemployment. We also show that, contrary to the policy advice of some labour market observers, an increase in the precision of the public signal does not necessarily lead to a reduction in the rate of unemployment.

keywords

Returns to Education, Occupational Choice, Information Processing

Authors biography

Gianluca Femminis, Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore, Milano. Email: gianluca.femminis@unicatt.it.
Giulio Piccirilli (Corresponding Author), Universitas Mercatorum, Roma. Email: g.piccirilli@unimercatorum.it.