Students’ Perceived Returns to Skills

Abstract
Using a sample of students at a large university in Switzerland, we study how students perceive the labor market returns to digital, management and social skills. We find that students expect the highest monetary returns from digital skills and the lowest from social skills. Male students perceive the returns to digital skills as considerably higher than female students and they invest more in digital skills. We confirm that students who expect higher monetary returns to digital skills invest more in these skills after accounting for other differences across students. However, different beliefs about the returns to digital skills only explain part of the gender gap in skill investments. Our result provide important insights for designing effective policies that aim to reduce skill mismatch in the labor market. Joint paper with Francesco La Russa and Renate Strobl.