abstract:

This paper provides evidence on the association between individuals' cognitive abilities, personality traits, and earnings. 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, as well as the Big Five inventory and the Grit scale to assess personality traits.

keywords: cognitive skills, personality traits, social skills, earnings

JEL codes: , ,

publication year: 2018

language : English

thematic categories :

publishing series : IBS Working Paper

publication number : 09/2018

ISSN : 2451-4373

additional information: This work was supported by the Polish National Science Centre (grant number 2017/27/B/HS4/01201).

authors:
Marta Palczyńska

Institute for Structural Research (IBS)

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