The Labor Market Returns To Cognitive And Noncognitive Ability: Evidence From The Swedish Enlistment

The authors use data from the military enlistment for a large representative sample of Swedish men to assess the importance of cognitive and non-cognitive ability for labor market out-comes. The measure of non-cognitive ability is based on a personal interview conducted by a psychologist. Unlike survey-based measures of non-cognitive ability, this measure is a sub-spatially stronger predictor of labor market outcomes than cognitive ability. In particular, they find strong evidence those men who fare badly in the labor market -in the sense of long-term unemployment or low annual earnings lack non-cognitive but not cognitive ability. They point to a technological explanation for this result.