Overeducation and wages: the role of cognitive skills and personality traits

Abstract

ABSTRACT This article investigates the extent to which personality traits and cognitive skills can be seen as potential determinants of overeducation, and can explain the overeducation wage penalty. Using a representative survey of the Polish working-age population with well-established measures of cognitive skills and personality traits, I find that accounting for personality and cognitive skills does not change the size and the statistical significance of overeducation wage penalty estimates. My results also demonstrate that personality is one of the contributors to the risk of being overeducated among workers aged 18–29, but not among workers aged 30–68. Among younger workers, agreeable individuals are more likely to be overeducated, while conscientious individuals are less likely to be overeducated. Moreover, lower numeracy skills are associated with higher probability of being overeducated.