College Expansion Policy and Educational Mismatch in China: An Empirical Analysis of Over-education

摘要

Against the background of the rapid supply of highlyeducated labor forces, the paper analyses the incidence and return of over education and under education within different occupations before and after college expansion implemented in 1999 in urban China. The data used in this paper comes from 16 consecutive annual surveys of urban households conducted by China's national bureau of statistics from 1994 through 2009, which is an extended reform period of higher education system. Using model value method, the incidence of over-and under-education indicates that a large proportion of Chinese workers enter the labor market educated inadequately, and the values are higher than many other countries and regions, which implies the remarkable educational mismatch and imperfect labor market in China. Based on ORU model, the estimated values and their trend of return to over-and under-education show that highlyeducated workers is still under incompletely utilization, while the economic status for the undereducated workers has been deteriorated in recent years, both phenomenon caused by unbalanced of skill biased supply and demand for occupation in Chinese labor market. According to the above empirical evidence, several reasonable policy implications are suggested.