The purpose of this paper is to analyze the effects of undereducation and over education on wages. To that end, we used data from the Transition to Em ployment Survey (ETVA-2015). With these data, we first proceeded to identify the downgraded individuals by the MCA. Then, knowing that the unemployed may have a reservation wage, which will bias our estimates, we proceeded to estimate a two-stage model to correct for this selection bias. Using this model, we found that downgrading determines workers’ wages. Undereducation improves wages, while overeducation reduces them. Based on these results, we advocated that policymakers should promote more youth placement through employment agencies and improve the supply of training in order to effectively meet the needs of firms.
KeywordsOvereducationUndereducationYouthsCongo
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