nep-neu New Economics Papers
on Neuroeconomics
Issue of 2023‒06‒12
three papers chosen by

  1. Revisiting the Returns to Higher Education: Heterogeneity by Cognitive and Non-Cognitive Abilities By Oliver Cassagneau-Francis
  2. The Value of Early-Career Skills By Simon Wiederhold; Christina Langer
  3. Does extreme temperature exposure take a toll on mental health? Evidence from the China Health and Retirement Longitudinal Study By Chen, Yanran; Sun, Ruochen; Chen, Xi; Qin, Xuezheng

  1. By: Oliver Cassagneau-Francis (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Recent work has highlighted the significant variation in returns to higher education across individuals. We develop a novel methodology-exploiting recent advances in the identification of mixture models-which groups individuals according to their prior ability and estimates the wage returns to a university degree by group. We prove the non-parametric identification of our model. Applying our method to data from a UK cohort study, our findings reflect recent evidence that skills and ability are multidimensional. Our flexible model allows the returns to university to vary across the (multi-dimensional) ability distribution, a flexibility missing from commonly used additive models, but which we show is empirically important. The returns to higher education are 3-4 times larger than the returns to prior cognitive and non-cognitive abilities. Returns are generally increasing in ability for both men and women, but vary non-monotonically across the ability distribution.
    Keywords: Mixture models, Distributions, Treatment effects, Higher education, Wages, Human capital, Cognitive and non-cognitive abilities
    Date: 2022–05–19
  2. By: Simon Wiederhold; Christina Langer
    Abstract: We develop novel measures of early-career skills that are more detailed, comprehensive, and labor-market-relevant than existing skill proxies. We exploit that skill requirements of apprenticeships in Germany are codified in state-approved, nationally standardized apprenticeship plans. These plans provide more than 13, 000 different skills and the exact duration of learning each skill. Following workers over their careers in administrative data, we find that cognitive, social, and digital skills acquired during apprenticeship are highly – yet differently – rewarded. We also document rising returns to digital and social skills since the 1990s, with a more moderate increase in returns to cognitive skills.
    Keywords: returns to skills, apprenticeship plans, labor market, earnings, early-career skills
    JEL: I21 I26 J24
    Date: 2023–02
  3. By: Chen, Yanran; Sun, Ruochen; Chen, Xi; Qin, Xuezheng
    Abstract: Long-term exposure to extreme temperatures could threaten individuals' mental health and psychological wellbeing. This study aims to investigate the long-term impact of cumulative exposure to extreme temperature. Differently from existing literature, we define extreme temperature exposure in relative terms based on local temperature patterns. Combining the China Health and Retirement Longitudinal Study and environmental data from the U.S. National Oceanic and Atmospheric Administration from 2011 to 2015, this study demonstrates that heat and cold exposure days in the past year significantly increase the measured depression level of adults over age 45 by 1.75 and 3.00 per cent, respectively, controlling for the city, year, and individual fixed effects. The effect is heterogeneous across three components of depression symptoms as well as age, gender, and areas of residency, and air conditioning and heating equipment are effective in alleviating the adverse impact of heat and cold exposure. The estimation is robust and consistent across a variety of temperature measurements and model modifications. Our findings provide evidence on the long-term and accumulative cost of extreme temperature to middle-aged and elderly human capital, contributing to the understanding of the social cost of climate change and the consequent health inequality.
    Keywords: mental health, climate change, extreme temperature, aging
    JEL: I12 I18 Q54
    Date: 2023

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