“Cultural Values and Productivity”, 2023-12-06 ():
This paper estimates differences in human capital as country-of-origin-specific labor productivity terms in firm production functions, making it immune to wage discrimination concerns.
After accounting for education and experience, estimated human capital varies by a factor of around 3 between the 90th and the 10th percentile.
When I investigate which country-of-origin characteristics most closely correlate with human capital, cultural values are the only robust predictor. This relationship persists among children of migrants.
Consistent with a plausible cultural mechanism, individuals whose origin places a high value on autonomy hold a comparative advantage in positions characterized by a low degree of routinization.
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