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Wage premia for skills: the complementarity of cognitive and non-cognitive skills

Palczyńska, Marta (2020): Wage premia for skills: the complementarity of cognitive and non-cognitive skills. Published in: International Journal of Manpower , Vol. 42, No. 4 (22 June 2021): pp. 556-580.

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Abstract

Purpose - The main purpose of this paper is to assess the degree of complementarity between cognitive skills and non-cognitive skills, and to evaluate their joint impact on individual wages. Design/methodology/approach – The author uses a survey representative of the Polish working-age population with well-established measures of cognitive and non-cognitive skills. Findings - Non-cognitive skills are important in the labour market, not only as separate factors that influence wages, but as complements to cognitive skills. Specifically, the analysis showed that the more neurotic an individual is, the lower his or her returns to cognitive skills are. Social skills were not shown to be complementary to cognitive skills in Poland, unlike the recent results in the United States. Originality/value - To the best of author’s knowledge, this is the first study to provide evidence that neurotic individuals have lower returns to cognitive skills. It also tests the existence of the complementarity between social and cognitive skills.

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