Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/250481 
Year of Publication: 
2021
Series/Report no.: 
IZA Discussion Papers No. 14820
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
There is an ongoing debate about the economic effects of individualism. We establish that individualism leads to better educational and labor market outcomes. Using data from the largest international adult skill assessment, we identify the effects of individualism by exploiting variation between migrants at the origin country, origin language, and person level. Migrants from more individualistic cultures have higher cognitive skills and larger skill gains over time. They also invest more in their skills over the life-cycle, as they acquire more years of schooling and are more likely to participate in adult education activities. In fact, individualism is more important in explaining adult skill formation than any other cultural trait that has been emphasized in previous literature. In the labor market, more individualistic migrants earn higher wages and are less often unemployed. We show that our results cannot be explained by selective migration or omitted origin-country variables.
Subjects: 
cognitive skills
culture
individualism
labor market
international comparisons
JEL: 
D91
J24
I20
Z13
Document Type: 
Working Paper

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