Labour Market Returns and the Evolution of Cognitive Skills


Jesse Shapiro

Monday 20 Sep 2021, 16:00 - 17:00
Online event

Online (Zoom)

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A large literature in cognitive science studies the puzzling 'Flynn effect' of rising fluid intelligence (reasoning skill) in rich countries. We develop an economic model in which a cohort’s mix of skills is determined by different skills’ relative returns in the labour market and by the technology for producing skills.

We estimate the model using administrative data from Sweden.

Combining data from exams taken at military enlistment with earnings records from the tax register, we document an increase in the relative labour market return to logical reasoning skill as compared to vocabulary knowledge. The estimated model implies that changes in labour market returns explain 36 percent of the measured increase in reasoning skill, and can also explain the decline in knowledge.

An original survey of parents, an analysis of trends in school curricula, and an analysis of occupational characteristics show evidence of increasing emphasis on reasoning as compared to knowledge.

Joint work with  Santiago Hermo, Brown University, Miika Päällysaho, Stockholm University and David Seim, Stockholm University, CEPR, and Uppsala University)

More information
  • If you want to attend this online seminar, you need to register. You will then be sent by email the details of the zoom session
  • Your microphone will be on mute upon joining the meeting, please leave it like that and unmute it only if you want to ask a question
  • Asking questions: please just go ahead and ask questions in the 'usual way' (i.e. do not use the chat unless you want to notify me/host of any problem related to seminar)
  • Also use the registration form to sign up for a bilateral on Monday (by Thursday 9 September at the latest)
  • Given the current restrictions there is only room for 30 people
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