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Empirical Economics

, Volume 47, Issue 2, pp 553–592 | Cite as

Heterogeneous returns to personality: the role of occupational choice

  • Katrin John
  • Stephan L. ThomsenEmail author
Article

Abstract

We analyze the role of personality in occupational choice and wages using data from Germany for the years 1992 to 2009. Characterizing personality by use of seven complementary measures (Big Five personality traits, locus of control, and a measure of reciprocity), the empirical findings show that personal characteristics are important determinants of occupational choice. Associated with that, identical personality traits are differently rewarded across occupations. Hence, breaking down the analysis on the level of occupational groups provides more detailed results of returns to personality. By evaluating different personality profiles, we additionally estimate the influence of personality as a whole. The estimates establish occupation-specific patterns of significant returns to particular personality profiles. These findings underline the importance to consider the occupational distribution when analyzing returns to personality due to its heterogeneous valuation.

Keywords

Occupational choice Wage differentials Big Five personality traits Locus of control Measures of reciprocity SOEP 

JEL Classification:

J24 J31 C35 

Notes

Acknowledgments

We thank Robert M. Kunst and an anonymous referee, Deborah Cobb-Clark, Kristin Kleinjans, Christoph Schmidt, and Barbara Grave for helpful comments as well as discussants at the research seminar at the University of Magdeburg, the labor market and social policy workshop at ifo Institute Dresden 2011, the Doctoral Meeting Montpellier 2011, the Canadian Economics Association Conference 2011, the Statistische Woche 2011 of the Deutsche Statistische Gesellschaft, and the Society of Labor Economists Conference 2012. Financial support from the Stifterverband für die Deutsche Wissenschaft (Claussen-Simon-Stiftung) and Wissenschaftszentrum Sachsen-Anhalt Lutherstadt Wittenberg (WZW) in the course of the project “Analyse des Bestands und der ökonomischen Bedeutung kognitiver und nicht-kognitiver Fähigkeiten in Sachsen-Anhalt zur Identifikation (bildungs-)politischer Handlungsbedarfe” is gratefully acknowledged. The data used in this publication were made available by the German Socio Economic Panel Study (SOEP) at the German Institute for Economic Research (DIW), Berlin.

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Copyright information

© Springer-Verlag Berlin Heidelberg 2013

Authors and Affiliations

  1. 1.Department of Economics and ManagementOtto-von-Guericke-University MagdeburgHannoverGermany
  2. 2.Leibniz University Hannover, ZEW MannheimHannoverGermany

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