The role of social preferences for life goals and career choices

Workers care not only about pay and career opportunities but also about meaningful work and socially responsible employers. This heterogeneity matters for worker-firm matching, recruitment, and compensation, yet its preference-based origins remain poorly understood. In a two-wave study of a sample broadly representative of the Swiss adult population (N=1,031), we study whether social preferences provide a common account of life goals, job preferences, and occupational sorting. We structurally estimate two facets of social preferences: altruism in the advantageous and in the disadvantageous domain. We show that these two dimensions are negatively correlated, and that failing to account for both can substantially bias — in our applications, underestimate — the effects of social preferences. Social preferences predict respondents’ life goals, their preferred job attributes, and their willingness to work in the tobacco industry. In particular, higher altruism is associated with lower emphasis on wealth, financial security, career status, pay, and advancement, but greater emphasis on corporate social responsibility and meaningful work. It also predicts greater willingness to avoid working in the tobacco industry. Lastly, altruism when ahead is positively associated with employment in education, health, and social services. Thus, this paper highlights the importance of social preferences for explaining worker motivation and labor-market sorting.