Immigrant Occupational Mobility and the Role of Educational Mismatches in the Home Country: Longitudinal Evidence from Sweden

Abstract: This thesis examines the occupational mobility of a sample of immigrants who arrived in Sweden between 1971 and 1985. The data includes information on pre-immigration occupation and on up to four occupations in Sweden. The empirical analysis supports a U-shaped pattern of occupational mobility from home country to host country which is in line with the theory of imperfect transferability of skills. Immigrants experience a drop in occupational status from the origin to the host country, with a subsequent increase with years since migration. The unique feature of this study is that it relates the labor market performance in Sweden to the educational mismatch in the home country. The evidence shows that after having controlled for the level of education, immigrants who were overeducated in their home countries have weaker labor market outcomes than their correctly matched counterparts. Undereducated individuals, however, perform better than correctly matched immigrants with the same level of education. Therefore, the thesis suggests that educational mismatch matters when it comes to immigrants’ occupational status in the destination country. The explanations for this phenomenon may be linked to ability or the signal provided by the home country work experience.