January 30, 2019

SOEP Brown Bag Seminar

Wage premia for skills: complementarity between cognitive and non-cognitive skills


January 30, 2019
12:30 - 13:30


DIW Berlin
Room 5.2.010
Mohrenstr. 58
10117 Berlin


Marta Palcznska (Institute for Structural Research)

I present evidence on the association between individuals' cognitive abilities, personality traits, and earnings in Poland. I find that cognitive skills and certain personality traits are complements. In particular, I find that cognitive skills and emotional stability are complementary, with neurotic individuals having significantly lower returns to their cognitive skills. Furthermore, my results indicate that agreeableness, neuroticism, and – surprisingly – grit are penalised significantly in the labour market; and that there is a positive relationship between conscientiousness and wages. Finally, I observe that, contrary to previous findings, women and men have similar returns to personality traits. I use well-established measures of cognitive skills and personality: namely, competence tests from the PIAAC survey to assess cognitive skills and the Big Five inventory and the Grit scale to assess personality traits.