Working Paper: NBER ID: w22657
Authors: Eric A. Hanushek; Guido Schwerdt; Simon Wiederhold; Ludger Woessmann
Abstract: Expanded international data from the PIAAC survey of adult skills allow us to analyze potential sources of the cross-country variation of comparably estimated labor-market returns to skills in a more diverse set of 32 countries. Returns to skills are systematically larger in countries that have grown faster in the recent past, consistent with models where skills are particularly important for adaptation to dynamic economic change.
Keywords: Returns to Skills; Economic Growth; International Comparison; Labor Market; Cognitive Skills
JEL Codes: I20; J31; O15
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Higher numeracy skills (G53) | Returns to skills vary by country (J24) |
| Higher returns to skills (J24) | Faster economic growth rates (O49) |
| Faster economic growth (O49) | Better economic environment for skilled workers (F66) |
| Higher gross hourly wages (J31) | Higher returns to skills (J24) |
| Union density and public employment (J45) | Confounding factors (C39) |
| Higher numeracy skills (G53) | Higher gross hourly wages (J31) |