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The effect of early cognitive ability on earnings over the life-cycle

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Author Info

  • Falch , Torberg

    ()
    (Department of Economics, Norwegian University of Science and Technology)

  • Sandgren Massih, Sofia

    ()
    (Uppsala Center for Labor Studies)

Abstract

This paper utilizes information on cognitive ability at age ten and earnings information from age 20 to 65 to estimate the return to ability over the life-cycle. Cognitive ability measured at an early age is not influenced by the individual’s choices of schooling. We find that most of the unconditional return to early cognitive ability goes through educational choice. The conditional return is increasing for low levels of experience and non-increasing for experience above about 15-25 years. The return is similar for men and women, and highest for individuals with academic education. Only a small part of the return can be explained by higher probability to have a supervisory position.

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File URL: http://www.ucls.nek.uu.se/digitalAssets/136/136452_20102.pdf
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Bibliographic Info

Paper provided by Uppsala University, Department of Economics in its series Working Paper Series, Center for Labor Studies with number 2010:2.

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Length: 40 pages
Date of creation: 19 Jan 2010
Date of revision:
Handle: RePEc:hhs:uulswp:2010_002

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Postal: Department of Economics, Uppsala University, P. O. Box 513, SE-751 20 Uppsala, Sweden
Phone: + 46 18 471 25 00
Fax: + 46 18 471 14 78
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Web page: http://www.nek.uu.se/
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Related research

Keywords: Cognitive ability; life-cycle; earnings; IQ; employer learning *;

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  1. Haegeland, T. & Klette, T.J. & Salvanes, K.G., 1999. "Declining Returns to Education in NOrway? Comparing Estimates Across Cohorts, Sectors and Over Time," Papers 14/99, Norwegian School of Economics and Business Administration-.
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Cited by:
  1. Torberg Falch & Sofia Sandgren, 2006. "The effect of education on cognitive ability," Working Paper Series 7306, Department of Economics, Norwegian University of Science and Technology.

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