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  4. April 2022
  5. The Rising Return to Noncognitive Skill

The Rising Return to Noncognitive Skill

  • Per-Anders Edin
  • Peter Fredriksson
  • Martin Nybom
  • Björn Öckert
American Economic Journal: Applied Economics
vol. 14, no. 2, April 2022
(pp. 78-100)
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Abstract

This paper uses administrative data from Sweden to document trends in the labor market returns to skills. Between 1992 and 2013, the economic return to noncognitive skill⁠—a psychologist-assessed measure of teamwork and leadership skill⁠—roughly doubled. The return to cognitive skill was relatively stable and decreased modestly during the 2000s, however. Among men with similar levels of education, the return to noncognitive skill is higher than the return to cognitive skill. The increasing return to noncognitive skill is driven by changes at the top of the wage distribution and by sorting into higher-paying occupations.

Citation

Edin, Per-Anders, Peter Fredriksson, Martin Nybom, and Björn Öckert. 2022. "The Rising Return to Noncognitive Skill." American Economic Journal: Applied Economics, 14 (2): 78-100. DOI: 10.1257/app.20190199

Additional Materials

JEL Classification

  • I26 Returns to Education
  • J24 Human Capital; Skills; Occupational Choice; Labor Productivity
  • J31 Wage Level and Structure; Wage Differentials
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