Labor Market Returns to Personality: A Job Search Approach to Understanding Gender Gaps

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Abstract
We investigate the effects of the big five personality traits on labor market outcomes and on gender disparities using a job search and bargaining framework. Parameters pertaining to productivity, job offer arrival rates, job dissolution rates and the division of surplus from an employer-employee match depend on worker personality traits and demographic characteristics. Estimation is based on a German panel dataset, and we find that personality characteristics are important determinants of labor market outcomes. Men and women frequently have quite different “returns” to these characteristics. We find that the bargaining channel is the most important in accounting for gender gaps. Joint with Petra Todd (University of Pennsylvania) and Weilong Zhang (University of Cambridge).

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