Standard economic theory predicts that firms will not invest in general training and will underinvest in specific training. Empirical evidence indicates, however, that firms do invest in general training of their workers and also points to no underinvestment in specific training. We propose a...

This chapter surveys the economics literature on overeducation. The original motivation to study this topic reports that the strong increase in the number of college graduates in the early 1970s in the United States led to a decrease in the returns to college education. We argue that Duncan and...