How important are the cognitive skills of teenagers in predicting subsequent earnings?
How important are teenagers' cognitive skills in predicting subsequent labor market success? Do cognitive skills pay off in the labor market only for students who go to college? Does college benefit only students who enter with strong basic skills? These questions are often parts of current policy debates about how to improve the earnings prospects for young Americans. This paper addresses these questions using two longitudinal data sets with earnings information from the mid-1980s and early 1990s. It shows that the same evidence can be used to support the claim that cognitive skills are important determinants of subsequent earnings, and that the effect of cognitive skills is modest. It also shows that while some evidence indicates that college pays off more for students who enter with strong cognitive skills than for students who enter with weaker skills, the bulk of the evidence does not support this conclusion. © 2000 by the Association for Public Policy Analysis and Management.
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Volume (Year): 19 (2000)
Issue (Month): 4 ()
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- Murnane, Richard J & Willett, John B & Levy, Frank, 1995.
"The Growing Importance of Cognitive Skills in Wage Determination,"
The Review of Economics and Statistics,
MIT Press, vol. 77(2), pages 251-66, May.
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96-11, Institute for Policy Resarch at Northwestern University.
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- Henry S. Farber & Robert Gibbons, 1996. "Learning and Wage Dynamics," The Quarterly Journal of Economics, Oxford University Press, vol. 111(4), pages 1007-1047.
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