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The Effect of Personality Traits and Behavioral Characteristics on Schooling, Earnings and Career Promotion

By analyzing the Japanese and U.S. survey data, this study investigates whether non-cognitive skills, as measured by Big 5 personality traits and behavioral characteristics indicated by risk aversion rate, time discount rate, and (over) confidence, explain the variation in educational and labor market outcomes. The obtained results indicate that non-cognitive skills, as well as behavioral characteristics, account for a significant portion in explaining the variation in schooling, wages, and career promotion. Some interesting country differences, particularly in educational attainment, are found in agreeableness and consciousness, which may suggest the existence of country-specific, non-cognitive determinants of educational success. With respect to labor market outcomes, in both Japan and the United States, conscientiousness seems to contribute to male earnings, whereas extraversion and emotional stability are more important predictors of female earnings. For career promotion, extraversion is an important determinant for the probability of being promoted to a management position among males in both countries. The overall findings suggest that personality traits are associated with educational and career success to different degrees between countries and genders.