Skill Shortage or Credential Inflation? Qualification mismatch in Great Britain and Germany, 1984-2017
The dramatic expansion of education since the second world war has been recognized as one of the major forces shaping social change. However, the question whether educa-tional expansion has outstripped the demand for qualified labour, or whether modern economies face a skill-shortage despite increases in education remains debated. Focus-sing on the United Kingdom and West Germany, this paper asks to what degree expan-sion of education has been absorbed by labour markets. I point out shortcomings of wage-centred analyses and develop an approach that focuses on trends in self-assessed over- and underqualification. Using repeated surveys, I link cohort-level expansion to mismatch prevalence. Results show that educational expansion gave rise to credential inflation and a positional value of education in the United Kingdom. West-Germany, on the other hand, is affected by a mild skill-shortage. I relate these findings to the con-trasting institutional logics of education systems in the two countries.