Noncognitive skills in training curricula and nonlinear wage returns
International Journal of Manpower
ISSN: 0143-7720
Article publication date: 2 February 2023
Issue publication date: 31 May 2023
Abstract
Purpose
The purpose of this paper is to investigate self-competence—the ability to act responsibly on one's own—and likely nonlinear wage returns across different levels of self-competence as part of training curricula.
Design/methodology/approach
The authors identify the teaching of self-competence at the occupational level by applying machine-learning methods to the texts of occupational training curricula. Defining three levels of self-competence (high, medium, and low) and using individual labor market data, the authors examine nonlinearities in wage returns to different levels of self-competence.
Findings
The authors find nonlinear returns to teaching self-competence: a medium level of self-competence taught in an occupation has the largest wage returns compared to low or high levels. However, in occupations with a high cognitive requirement profile, a high level of self-competence generates positive wage returns.
Originality/value
This paper first adds to research on the importance of teaching noncognitive skills for economic outcomes, which recently—in addition to personality traits research—has primarily focused on social skills by introducing self-competence as another largely unexplored but important noncognitive skill. Second, the paper studies not only average but also nonlinear wage returns, showing that the right level of self-competence is crucial, i.e. neither teaching too little nor too much self-competence provides favorable returns because of trade-offs with other skills (e.g. technical or professional skills). Third, the paper also examines complementarities between cognitive skills and noncognitive skills, again pointing toward nonlinear returns, i.e. only in occupations with a high cognitive requirement profile, high levels of self-competence generate positive wage returns.
Keywords
Acknowledgements
This study is partly funded by the Swiss State Secretariat for Education, Research, and Innovation (SERI) through its “Leading House VPET-ECON: A Research Center on the Economics of Education, Firm Behavior and Training Policies” and the Swiss National Science Foundation through the National Research Program 77. This paper has benefitted from many audiences and exchanges. In particular, the authors would like to thank the anonymous referees for the helpful comments as well as the following individuals for their help and support: Simone Balestra, Simon Clematide, Eric Bettinger, Edward Lazear, conference participants at SASE and at AEDE, and seminar participants at the University of Zurich for helpful comments and Natalie Reid for language consulting. The authors thank the Swiss Federal Statistical Office for providing the labor market data. The purchased data on cognitive requirement profiles of each VET occupation (“Anforderungsprofile”) belongs to the Swiss Trade Association.
Citation
Kiener, F., Gnehm, A.-S. and Backes-Gellner, U. (2023), "Noncognitive skills in training curricula and nonlinear wage returns", International Journal of Manpower, Vol. 44 No. 4, pp. 772-788. https://doi.org/10.1108/IJM-03-2022-0119
Publisher
:Emerald Publishing Limited
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