Doctor of Philosophy
Lochner, Lance J
My thesis consists of three chapters that study relationships between college majors and multi-dimensional skills.
Chapter 2 examines the sources of wage penalties for working outside one's major field of study. Previous papers show that workers in a job which is unrelated to their major field of study tend to earn significantly lower wages than those in a related job. I use the 1993 National Survey of College Graduates and the O*NET to divide the sources of wage penalty into the levels of basic skills required in a job and the mismatch in major-specific knowledge. I find that the average wage penalty is 9% after conditioning on individual characteristics, such as degree type and field of study. Around 45% of the wage penalty stems from differences in the required levels of basic skills between related and unrelated jobs. I also find that the results are heterogeneous across degree types and fields of study. A mismatch in major-specific knowledge has a large effect on wages of workers with an advanced or specialized degree and on those who majored in Computer and Math Sciences or Engineering.
Chapter 3 estimates skill growth during college by major using the National Longitudinal Survey of Youth 1997 (NLSY97) and the O*NET. To capture both the type and quantity of accumulated skills, I assume that each major increases a general cognitive skill and a major-specific skill. I further allow for individual heterogeneity in skill growth. I take a task-based approach and use occupation choice to estimate skill growth in general cognitive skill. To deal with noisy skill measurements and endogeneity, a dynamic factor model is constructed. The results show a substantial growth of general cognitive skill in all majors, but with large differences across majors. I find different effects of pre-college skill levels on skill growth by major, but the differences are not large. The contribution of major-specific skill growth to wage growth is small compared to that of general cognitive skill growth.
Chapter 4 examines what skills are most closely associated with male college workers becoming managers from the perspective of human capital theory, with a focus on cognitive and social skills. I first construct a social task intensity measure using the American Community Survey 2010-2017 and the O*NET and document that management jobs tend to have high levels of social and cognitive task intensity. I then use the NLSY97 and analyze the transition patterns into management jobs. Most workers start their careers in non-management jobs, but workers who become managers relatively quickly tend to have jobs involving intense social tasks in an early stage of their careers, which may lead to a greater increase in their social skill. Business & Economics majors are more likely to become managers, but the results suggest that this mostly stems from skills other than social skill.
Summary for Lay Audience
College education increases individual’s productivity in the labour market. However, what students learn substantially depends on their chosen major. My thesis consists of three chapters that empirically study labour-market correlates and consequences of college majors using US detasets. Chapter 2 examines why workers in jobs that are unrelated to their college major tend to earn lower wages than those in related jobs. Will workers suffer from low wages in any type of jobs unrelated to their major? This question is important in what kind of jobs workers should have. I show that the wage penalties partially stem from the fact that unrelated jobs workers tend to hold require lower levels of general type of cognitive skills than related jobs workers tend to hold. Mismatch in major-specific type of skills is not as important as it looks. I also find heterogeneous results across degree types and fields of study. Chapter 3 estimates what skills college students increase by major. I assume that each major increases a general cognitive skill and a major-specific skill. The literature mostly focuses on wage differences across majors, but this multi-dimensional skills framework will be helpful to understand differences across majors deeply. I show that increase in general cognitive skill is a key feature of college education. I find large differences in the skill growth across majors. Chapter 4 examines what skills are most closely associated with male college workers becoming managers. I focus on social skill, which is the capacity to work with others to achieve goals, and cognitive skill. I first empirically document that management jobs tend to require higher levels of cognitive and social skills than non-management jobs. I then show that most workers start their careers in non-management jobs but that workers who become managers relatively quickly tend to have jobs that require a high level of social skill in an early stage of their careers, which may have a greater increase in their social skill. Business & Economics majors are more likely to become managers. The results suggest that this mostly stems from skills other than social skill.
Onozuka, Yuki, "Essays on College Majors and Skills" (2019). Electronic Thesis and Dissertation Repository. 6617.
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