Is personality related to permanent earnings? Evidence using a twin design

Terhi Maczulskij and Jutta Viinikainen

Journal of Economic Psychology, 2018, vol. 64, issue C, 116-129

Abstract: Using twin survey combined with register-based panel data on labor market outcomes, the authors examine the association between personality characteristics and long-term earnings among prime working-age individuals. The long-term earnings were measured over the 1990–2008 period. The sample contains 4,642 twin pairs, of which 53% are females. In contrast to previous studies, this paper uses the within-twin dimension of the data to control for shared family background and confounding genetic factors. The results suggest that unobserved genetic differences may introduce omitted variable bias in standard ordinary least square results. After controlling for shared environment and genetic background, the authors find that a facet of extraversion (activity) is related to higher (β = 0.046), and neuroticism is related to lower (β = -0.060) permanent earnings in the labor market. The lower earnings of more neurotic individuals are likely explained by the weaker attachment in the labor market.

Keywords: Personality; Earnings; Labor market outcomes; Unobserved heterogeneity; Twin studies (search for similar items in EconPapers)
JEL-codes: J24 J31 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (18)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0167487017303872
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:joepsy:v:64:y:2018:i:c:p:116-129

DOI: 10.1016/j.joep.2018.01.001

Access Statistics for this article

Journal of Economic Psychology is currently edited by G. Antonides and D. Read

More articles in Journal of Economic Psychology from Elsevier
Bibliographic data for series maintained by Catherine Liu ().