The Effect of Educational Mismatches on Life Satisfaction and Income (Evidence from RLMS HSE)

Educational mismatch is situation when workers’ formal education does not match their jobs. Evidence from many countries shows that such mismatch leads to the decrease of salary income. At the same time, there are contradictory empirical results on whether the wage "penalty" for the educational mismatch is the same for different categories of workers, and how such discrepancy affects job satisfaction. In this paper, the effects of educational mismatch in Russia are discussed. We use representative data on Russian workers from RLMS HSE. In order to clarify explanatory model, the parameter of skill mismatch was used alongside educational mismatch. This allowed us to take into account not only the formal discrepancy between education and job, but also the divergence of the real human capital and the professional position of the respondents. Regression analysis has shown that both educational mismatch and skill mismatch have a negative impact on income, as well as job satisfaction; these parameters also increase the likelihood that the employee will want to find a new job. We can talk about the universality of the revealed effects: neither gender nor the status of self-employed / entrepreneur had a significant impact on the given connections. The fact that educational mismatch and skill mismatch affect these indicators separately from each other demonstrates that these are two different phenomena that cannot be used as indicators or "proxies" of each other.