Heterogeneous skill distribution and college major: evidence from PIAAC
A large literature documents the uneven distribution of labor market outcomes across majors. Students in STEM (science, technology, engineering, and mathematics) can earn more than their peers. This earnings gap can be attributed not only to the differential educational resources investment but also...
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| Format: | Article |
| Language: | English |
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Taylor & Francis Group
2019-01-01
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| Series: | Journal of Applied Economics |
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| Online Access: | http://dx.doi.org/10.1080/15140326.2019.1665310 |
| _version_ | 1818381970465357824 |
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| author | Kan Yao |
| author_facet | Kan Yao |
| author_sort | Kan Yao |
| collection | DOAJ |
| description | A large literature documents the uneven distribution of labor market outcomes across majors. Students in STEM (science, technology, engineering, and mathematics) can earn more than their peers. This earnings gap can be attributed not only to the differential educational resources investment but also to heterogeneous distribution of initial cognitive skills across majors. I benefit from the rich data from the Programme for the International Assessment of Adult Competencies to examine this earnings gap in the United Stated and the United Kingdom. Based on my findings, this paper establishes new facts that add to the understanding of how college field premiums are generated. I show that a sizable portion of the return to majors is due to self-selection and up to two-fifths of the field premiums can be explained by basic cognitive skills. Despite the qualitatively similar impacts of numeracy and literacy skills on choosing college field of study, the pricing of numeracy is much higher than literacy in the labor market. |
| first_indexed | 2024-12-14T02:43:02Z |
| format | Article |
| id | doaj.art-ec970c72c93b42f4af13768b695aa845 |
| institution | Directory Open Access Journal |
| issn | 1514-0326 1667-6726 |
| language | English |
| last_indexed | 2024-12-14T02:43:02Z |
| publishDate | 2019-01-01 |
| publisher | Taylor & Francis Group |
| record_format | Article |
| series | Journal of Applied Economics |
| spelling | doaj.art-ec970c72c93b42f4af13768b695aa8452022-12-21T23:19:58ZengTaylor & Francis GroupJournal of Applied Economics1514-03261667-67262019-01-0122150452610.1080/15140326.2019.16653101665310Heterogeneous skill distribution and college major: evidence from PIAACKan Yao0University of California, Los Angeles (UCLA)A large literature documents the uneven distribution of labor market outcomes across majors. Students in STEM (science, technology, engineering, and mathematics) can earn more than their peers. This earnings gap can be attributed not only to the differential educational resources investment but also to heterogeneous distribution of initial cognitive skills across majors. I benefit from the rich data from the Programme for the International Assessment of Adult Competencies to examine this earnings gap in the United Stated and the United Kingdom. Based on my findings, this paper establishes new facts that add to the understanding of how college field premiums are generated. I show that a sizable portion of the return to majors is due to self-selection and up to two-fifths of the field premiums can be explained by basic cognitive skills. Despite the qualitatively similar impacts of numeracy and literacy skills on choosing college field of study, the pricing of numeracy is much higher than literacy in the labor market.http://dx.doi.org/10.1080/15140326.2019.1665310wage premiumscognitive skillsfield of study |
| spellingShingle | Kan Yao Heterogeneous skill distribution and college major: evidence from PIAAC Journal of Applied Economics wage premiums cognitive skills field of study |
| title | Heterogeneous skill distribution and college major: evidence from PIAAC |
| title_full | Heterogeneous skill distribution and college major: evidence from PIAAC |
| title_fullStr | Heterogeneous skill distribution and college major: evidence from PIAAC |
| title_full_unstemmed | Heterogeneous skill distribution and college major: evidence from PIAAC |
| title_short | Heterogeneous skill distribution and college major: evidence from PIAAC |
| title_sort | heterogeneous skill distribution and college major evidence from piaac |
| topic | wage premiums cognitive skills field of study |
| url | http://dx.doi.org/10.1080/15140326.2019.1665310 |
| work_keys_str_mv | AT kanyao heterogeneousskilldistributionandcollegemajorevidencefrompiaac |