IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp10914.html
   My bibliography  Save this paper

The Rising Return to Non-Cognitive Skill

Author

Listed:
  • Edin, Per-Anders

    () (IFAU)

  • Fredriksson, Peter

    () (Uppsala University)

  • Nybom, Martin

    () (SOFI, Stockholm University)

  • Öckert, Björn

    () (IFAU)

Abstract

We examine the changes in the relative rewards to cognitive and non-cognitive skill during the time period 1992–2013. Using unique administrative data for Sweden, we document a secular increase in the returns to non-cognitive skill, which is particularly pronounced in the private sector and at the upper-end of the wage distribution. Workers with an abundance of non-cognitive skill were increasingly sorted into occupations that were intensive in: cognitive skill; as well as abstract, non-routine, social, non-automatable and offshorable tasks. Such occupations were also the types of occupations which saw greater increases in the relative return to non-cognitive skill. Moreover, we show that greater emphasis is placed on noncognitive skills in the promotion to leadership positions over time. These pieces of evidence are consistent with a framework where non-cognitive, inter-personal, skills are increasingly required to coordinate production within and across workplaces.

Suggested Citation

  • Edin, Per-Anders & Fredriksson, Peter & Nybom, Martin & Öckert, Björn, 2017. "The Rising Return to Non-Cognitive Skill," IZA Discussion Papers 10914, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp10914
    as

    Download full text from publisher

    File URL: http://ftp.iza.org/dp10914.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. David H. Autor & Frank Levy & Richard J. Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, issue Nov.
    2. Gonzalo Castex & Evgenia Kogan Dechter, 2014. "The Changing Roles of Education and Ability in Wage Determination," Journal of Labor Economics, University of Chicago Press, vol. 32(4), pages 685-710.
    3. Timothy J. Bartik, 1991. "Who Benefits from State and Local Economic Development Policies?," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number wbsle, December.
    4. 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 101-128, January.
    5. David Hummels & Rasmus J?rgensen & Jakob Munch & Chong Xiang, 2014. "The Wage Effects of Offshoring: Evidence from Danish Matched Worker-Firm Data," American Economic Review, American Economic Association, vol. 104(6), pages 1597-1629, June.
    6. David S. Lee, 2009. "Training, Wages, and Sample Selection: Estimating Sharp Bounds on Treatment Effects," Review of Economic Studies, Oxford University Press, vol. 76(3), pages 1071-1102.
    7. Martin Nybom, 2017. "The Distribution of Lifetime Earnings Returns to College," Journal of Labor Economics, University of Chicago Press, vol. 35(4), pages 903-952.
    8. Acemoglu, Daron & Autor, David, 2011. "Skills, Tasks and Technologies: Implications for Employment and Earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.),Handbook of Labor Economics, edition 1, volume 4, chapter 12, pages 1043-1171, Elsevier.
    9. David J. Deming, 2017. "The Growing Importance of Social Skills in the Labor Market," The Quarterly Journal of Economics, Oxford University Press, vol. 132(4), pages 1593-1640.
    10. Tinbergen, Jan, 1974. "Substitution of Graduate by Other Labour," Kyklos, Wiley Blackwell, vol. 27(2), pages 217-226.
    11. Adrian Adermon & Magnus Gustavsson, 2015. "Job Polarization and Task-Biased Technological Change: Evidence from Sweden, 1975–2005," Scandinavian Journal of Economics, Wiley Blackwell, vol. 117(3), pages 878-917, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Marcelo Arbex & Enlinson Mattos, 2017. "Optimal Paternalistic Health and Human Capital Policies," Working Papers 1709, University of Windsor, Department of Economics.
    2. Maarten Goos & Melanie Arntz & Ulrich Zierahn & Terry Gregory & Stephanie Carretero Gomez & Ignacio Gonzalez Vazquez & Koen Jonkers, 2019. "The Impact of Technological Innovation on the Future of Work," JRC Working Papers on Labour, Education and Technology 2019-03, Joint Research Centre (Seville site).
    3. Spencer Bastani & Daniel Waldenström, 2020. "The Ability Gradient in Bunching," CESifo Working Paper Series 8233, CESifo.
    4. Hull, Marie C. & Norris, Jonathan, 2018. "The Skill Development of Children of Immigrants," IZA Discussion Papers 11724, Institute of Labor Economics (IZA).
    5. Aline Bütikofer & Giovanni Peri, 2017. "Cognitive and Noncognitive Skills and the Selection and Sorting of Migrants," NBER Working Papers 23877, National Bureau of Economic Research, Inc.
    6. Maksimova, Mariia, 2019. "The return to non-cognitive skills on the Russian labor market," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 53, pages 55-72.

    More about this item

    Keywords

    wage inequality; sorting; returns to skills; cognitive skills; noncognitive skills;

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp10914. 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: (Holger Hinte). General contact details of provider: http://www.iza.org .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.