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Conscientiousness Matters: How does Personality affect Labor Market Outcomes?

Justine Herve, Helene Purcell and Subha Mani
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Justine Herve: Stevens Institute of Technology
Helene Purcell: University of Pennsylvania

Fordham Economics Discussion Paper Series from Fordham University, Department of Economics

Abstract: Personality traits play an important role in shaping labor market outcomes, but the associated behaviors that lead to these differences are understudied. In this paper, we examine the returns to the Big Five personality traits as well as the mechanisms through which personality affects employment and earnings. We find conscientiousness to be a significant predictor of both employment and earnings. We further show that the association between conscientiousness and earnings operates primarily through one specific behavior, namely, individual effort. Additionally, we can eliminate job characteristics and collective bargaining as potential channels for the positive relationship between conscientiousness and earnings.

Keywords: Big Five personality traits; Conscientiousness; Labor market returns; Effort (search for similar items in EconPapers)
JEL-codes: D91 F63 I25 J01 J24 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-lab
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