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An Economic Analysis of Identity and Career Choice

Author

Listed:
  • Maria Knoth Humlum
  • Kristin J. Kleinjans
  • Helena Skyt Nielsen

    (School of Economics and Management, University of Aarhus, Denmark)

Abstract

Standard economic models which focus on pecuniary payo¤s cannot explain why there are highly able individuals who choose careers with low pecuniary re- turns. Therefore, financial incentives are unlikely to be effective in influencing career choices of these individuals. Based on Akerlof and Kranton (2000), we con- sider a model of career choice and identity where individuals derive non-pecuniary identity payoffs. Using factor analysis on a range of attitude questions, we find two factors related to identity (career orientation and social orientation), which are important for educational choices. The implication is that policymakers and institutions of higher education need to focus on identity related issues rather than just improved financial incentives if they aim at attracting the high ability youth to occupations with excess demand for labor.

Suggested Citation

  • Maria Knoth Humlum & Kristin J. Kleinjans & Helena Skyt Nielsen, 2007. "An Economic Analysis of Identity and Career Choice," Economics Working Papers 2007-14, Department of Economics and Business Economics, Aarhus University.
    • Handle: RePEc:aah:aarhec:2007-14
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    References listed on IDEAS

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    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education

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