IDEAS home Printed from
MyIDEAS: Login to save this article or follow this journal

The effect of noncognitive ability on the earnings of young men: A distributional analysis with measurement error correction

  • Eren, Ozkan
  • Ozbeklik, Serkan
Registered author(s):

    Utilizing the National Educational Longitudinal Study data, this paper examines the role of pre-market cognitive and noncognitive ability, as measured in tenth grade, on the earnings of young men. In addition to the conditional mean, we estimate the impact over the earnings distribution using recently developed (instrumental) quantile regression method. Our results show that noncognitive ability is an important determinant of earnings, but the effects are not uniform across the distribution. We find noncognitive ability to be the most important at lower quantiles. The impact of cognitive ability, on the other hand, shows a more homogenous pattern. Several robustness checks support these results.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL:
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Article provided by Elsevier in its journal Labour Economics.

    Volume (Year): 24 (2013)
    Issue (Month): C ()
    Pages: 293-304

    in new window

    Handle: RePEc:eee:labeco:v:24:y:2013:i:c:p:293-304
    Contact details of provider: Web page:

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as in new window
    1. Goldsmith, Arthur H & Veum, Jonathan R & Darity, William, Jr, 1997. "The Impact of Psychological and Human Capital on Wages," Economic Inquiry, Western Economic Association International, vol. 35(4), pages 815-29, October.
    2. David H. Autor & Lawrence F. Katz & Melissa S. Kearney, 2008. "Trends in U.S. Wage Inequality: Revising the Revisionists," The Review of Economics and Statistics, MIT Press, vol. 90(2), pages 300-323, May.
    3. Grönqvist, Erik & Vlachos, Jonas & Öckert, Björn, 2011. "The Intergenerational Transmission of Cognitive and Non-Cognitive Abilities," Working Paper Series 884, Research Institute of Industrial Economics.
    4. Chernozhukov, Victor & Hansen, Christian, 2006. "Instrumental quantile regression inference for structural and treatment effect models," Journal of Econometrics, Elsevier, vol. 132(2), pages 491-525, June.
    5. James J. Heckman & Jora Stixrud & Sergio Urzua, 2006. "The Effects of Cognitive and Noncognitive Abilities on Labor Market Outcomes and Social Behavior," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 411-482, July.
    6. Claudia Olivetti & Barbara Petrongolo, 2005. "Unequal pay or unequal employment? A cross-country analysis of gender gaps," Boston University - Department of Economics - Working Papers Series WP2005-008, Boston University - Department of Economics.
    7. Karsten Hansen & James J. Heckman & Kathleen J. Mullen, 2003. "The Effect of Schooling and Ability on Achievement Test Scores," NBER Working Papers 9881, National Bureau of Economic Research, Inc.
    8. Erik Lindqvist & Roine Vestman, 2011. "The Labor Market Returns to Cognitive and Noncognitive Ability: Evidence from the Swedish Enlistment," American Economic Journal: Applied Economics, American Economic Association, vol. 3(1), pages 101-28, January.
    9. Buchinsky, Moshe, 1994. "Changes in the U.S. Wage Structure 1963-1987: Application of Quantile Regression," Econometrica, Econometric Society, vol. 62(2), pages 405-58, March.
    10. Nicola Persico & Andrew Postlewaite & Dan Silverman, 2004. "The Effect of Adolescent Experience on Labor Market Outcomes: The Case of Height," NBER Working Papers 10522, National Bureau of Economic Research, Inc.
    11. Thomas DeLeire & Margo Coleman, 2000. "An Economic Model of Locus of Control and the Human Capital Investment Decision," Working Papers 0019, Harris School of Public Policy Studies, University of Chicago.
    12. Katz, L.F. & Murphy, K.M., 1991. "Changes in Relative Wages, 1963-1987: Supply and Demand Factors," Harvard Institute of Economic Research Working Papers 1580, Harvard - Institute of Economic Research.
    13. J. A. Hausman & W. K. Newey & J. L. Powel, 1988. "Nonlinear Errors in Variables: Estimation of Some Engel Curves," Working papers 504, Massachusetts Institute of Technology (MIT), Department of Economics.
    14. Nicole M. Fortin, 2008. "The Gender Wage Gap among Young Adults in the United States: The Importance of Money versus People," Journal of Human Resources, University of Wisconsin Press, vol. 43(4).
    15. Borghans, Lex & Duckworth, Angela Lee & Heckman, James J. & Weel, Bas ter, 2008. "The Economics and Psychology of Personality Traits," MERIT Working Papers 010, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    16. Markus Frölich & Blaise Melly, 2013. "Unconditional Quantile Treatment Effects Under Endogeneity," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 31(3), pages 346-357, July.
    17. Carneiro, Pedro & Heckman, James J., 2003. "Human Capital Policy," IZA Discussion Papers 821, Institute for the Study of Labor (IZA).
    18. Powell, James L., 1986. "Censored regression quantiles," Journal of Econometrics, Elsevier, vol. 32(1), pages 143-155, June.
    19. Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January.
    20. Bound, John & Brown, Charles & Mathiowetz, Nancy, 2001. "Measurement error in survey data," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 59, pages 3705-3843 Elsevier.
    21. Andrew Chesher, 2001. "Parameter approximations for quantile regressions with measurement error," CeMMAP working papers CWP02/01, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
    22. Gabriel Montes-Rojas, 2011. "Quantile Regression with Classical Additive Measurement Errors," Economics Bulletin, AccessEcon, vol. 31(4), pages 2863-2868.
    23. Schennach, Susanne M., 2008. "Quantile Regression With Mismeasured Covariates," Econometric Theory, Cambridge University Press, vol. 24(04), pages 1010-1043, August.
    24. Gerrit Mueller & Erik Plug, 2006. "Estimating the effect of personality on male and female earnings," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 60(1), pages 3-22, October.
    25. Joseph G. Altonji & Todd E. Elder & Christopher R. Taber, 2000. "Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools," NBER Working Papers 7831, National Bureau of Economic Research, Inc.
    26. Yuichi Kitamura & William Johnson & Derek Neal, 2000. "Evaluating a Simple Method for Estimating Black-White Gaps in Median Wages," American Economic Review, American Economic Association, vol. 90(2), pages 339-343, May.
    27. Cunha, Flavio & Heckman, James J. & Lochner, Lance John & Masterov, Dimitriy V., 2005. "Interpreting the Evidence on Life Cycle Skill Formation," IZA Discussion Papers 1675, Institute for the Study of Labor (IZA).
    28. Guido Heineck, 2011. "Does It Pay To Be Nice? Personality And Earnings In The UK," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 64(5), pages 1020-1038, October.
    29. Derek A. Neal & William R. Johnson, 1995. "The Role of Pre-Market Factors in Black-White Wage Differences," NBER Working Papers 5124, National Bureau of Economic Research, Inc.
    30. Carmit Segal, 2013. "Misbehavior, Education, And Labor Market Outcomes," Journal of the European Economic Association, European Economic Association, vol. 11(4), pages 743-779, 08.
    31. Moshe Buchinsky, 1998. "Recent Advances in Quantile Regression Models: A Practical Guideline for Empirical Research," Journal of Human Resources, University of Wisconsin Press, vol. 33(1), pages 88-126.
    32. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-42, June.
    33. Racine, Jeff & Li, Qi, 2004. "Nonparametric estimation of regression functions with both categorical and continuous data," Journal of Econometrics, Elsevier, vol. 119(1), pages 99-130, March.
    34. Chernozhukov, Victor & Hansen, Christian, 2008. "Instrumental variable quantile regression: A robust inference approach," Journal of Econometrics, Elsevier, vol. 142(1), pages 379-398, January.
    35. Zheng, John Xu, 1998. "A Consistent Nonparametric Test Of Parametric Regression Models Under Conditional Quantile Restrictions," Econometric Theory, Cambridge University Press, vol. 14(01), pages 123-138, February.
    36. Melissa Osborne & Herbert Gintis & Samuel Bowles, 2001. "The Determinants of Earnings: A Behavioral Approach," Journal of Economic Literature, American Economic Association, vol. 39(4), pages 1137-1176, December.
    37. Tristen Hayfield & Jeffrey S. Racine, . "Nonparametric Econometrics: The np Package," Journal of Statistical Software, American Statistical Association, vol. 27(i05).
    38. Wei, Ying & Carroll, Raymond J., 2009. "Quantile Regression With Measurement Error," Journal of the American Statistical Association, American Statistical Association, vol. 104(487), pages 1129-1143.
    39. Green, Francis & Machin, Stephen & Wilkinson, David, 1998. "The Meaning and Determinants of Skills Shortages," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 60(2), pages 165-87, May.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:eee:labeco:v:24:y:2013:i:c:p:293-304. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.