Determinants and wage penalty of qualification mismatches: the case of Palestine

ABSTRACT

Although it might be considered one of the main vigorous distortions in the Palestinian labour market, qualification mismatch has not been studied by researchers in Palestine. We draw upon this gap using Palestinian labour force survey between 2009 and 2016. This paper therefore presents a multinomial logit model to identify the factors affecting the prevalence of qualification mismatch and uses the Verdugo and Verdugo model to estimate its impact on wages. Findings support the spatial mobility theory, job competition theory and assignment theory which consider mismatch as a persistence phenomenon. Accepting mismatched job in early period of career life will not shorten the pathway for a matching job in the future. Female, married workers, rural and camp dwellers, workers in Israeli labour market, workers in construction, services, commerce and hotel sectors have more likelihood to face mismatches than others. Findings also reveal the existence of a wage penalty due to over-qualification mismatches and wage premiums for underqualification.

KEYWORDS:

• Palestine
• qualification mismatch

Disclosure Statement

No potential conflict of interest was reported by the author(s).

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article.

Notes

1. A robustness check using a pooled multinomial model with years included as dummies shows that results are qualitatively unaffected. These results are available upon request.

2. Results are available upon request.

Additional information

Notes on contributors

Rabeh Morrar

Rabeh Morrar received his Ph.D. in Innovation Economy from Lille 1 University for Science and Technology, Lille, France in 2011. He joined An-Najah National University, Palestine, as assistant professor in Economics and was Economics Department head, 2011 to 2015. Between May 2018 to June 2019, he has worked as senior researcher in the Centre of International Development at Northumbria University, UK. Afterward, he received a postdoctoral in Social Innovation. Currently, Dr. Morrar is working as a research associate at the Palestine Economic Policy Research Institute-MAS. His current research interests include Knowledge Economy, Innovation Economy, and International Development.

Hélène Syed Zwick

Dr. Hélène Syed Zwick is ESLSCA Research Center of Excellence (ERCE) Executive Director and associate professor of economics at ESLSCA University Egypt. Her research interests span the fields of labour economics and human mobility. Her current research explores the decision-making process of people on the move in mixed migration contexts.