A Study Of The Effect Of Cognitive Skill Use And Non-Cognitive Skills On Labor Incentives

In the neo-human capital theory,the role of cognitive and non-cognitive abilities in the accumulation of human capital is gradually being emphasized.For individuals,the main purpose of accumulating human capital is to obtain the corresponding labor incentives,the most important of which are wage and job promotion.Therefore,this paper examines the effects of cognitive skill use at work and non-cognitive skills on wages and job promotion through two sets of model designs respectively,and draws corresponding policy implications based on the results.This paper uses data from PIAAC in Japan to estimate the hourly wage returns to four types of cognitive skill use at work.The results show that the use of ICT skills and reading skills at work significantly contribute to task-specific human capital accumulation.Heterogeneity analysis revealed that the returns to cognitive skill use at work differ by different characteristics and income levels.The results of the proxies estimation,heterogeneity tests,and multiple indicator estimation suggest that the observable endogeneity from self-selection does not introduce significant bias.Finally,this paper uses mediating effects analysis to find that most cognitive skill use at work accumulates task-specific human capital via learning by doing.This paper uses data from the 2018 CFPS to estimate the effect of non-cognitive skills on the probability of job promotion.The results show that non-cognitive skills have a significant positive effect on job promotion and that only the openness personality trait among the Big Five personality traits has a significant positive effect on job promotion.The heterogeneity analysis shows that there are differences in the returns to job promotion for non-cognitive skills across samples with different characteristics.This paper uses proxy estimation and propensity score matching method to address endogeneity,respectively.The results show that the estimation results of the baseline model are not significantly biased by observable endogeneity.In addition,this paper performs robustness checks by reconstructing the job promotion variables.Finally,this paper finds that the effect of non-cognitive skills on job promotion is partially generated through the accumulation of social capital by conducting a mediating effects analysis using the proxy variables of social capital.