Education, labour market experience and cognitive skills: evidence from PIAAC

Juan F Jimeno (), Aitor Lacuesta (), Marta Martínez-Matute () and Ernesto Villanueva

No 1635, Working Papers from Banco de España

Abstract: We study how formal education and experience in the labour market correlate with measures of human capital available in thirteen countries participating in the Program for the International Assessment of Adult Competences (PIAAC), an international study assessing adults’ proficiency in numeracy and literacy. Two findings are consistent with the notion that, in producing human capital, work experience is a substitute for formal education for respondents with compulsory schooling. Firstly, the number of years of working experience correlates with performance in PIAAC mostly among low-educated individuals. Secondly, individual fixed-effect models suggest that workers in jobs intensive in numerical tasks – relative to reading tasks – perform relatively better in the numeracy section of the PIAAC test than in the reading part. The results are driven by young individuals with low levels of schooling and hold mainly for simple tasks, suggesting that our findings are not fully generated by the sorting of workers across jobs. A back-of-the-envelope estimate suggests that the contribution of on-the-job learning to skill formation is a quarter of that of compulsory schooling in the countries we analyse.

Keywords: human capital; tasks; education; working experience; cognitive skills (search for similar items in EconPapers)
JEL-codes: I20 J24 J31 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2016-12
New Economics Papers: this item is included in nep-dem, nep-edu, nep-eur and nep-hrm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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