The Role of Noncognitive Skills in Explaining Cognitive Test Scores

Abstract

This paper examines whether noncognitive skills -measured both by personality traits and economic preference parameters -influence cognitive tests performance. The basic idea is that noncognitive skills might affect the effort people put into a test to obtain good results. We experimentally varied the rewards for questions in a cognitive test to measure to what extent people are sensitive to financial incentives. To distinguish increased mental effort from extra time investments we also varied the questions' time constraints. Subjects with favorable personality traits such as high performance-motivation and an internal locus of control perform relatively well in the absence of rewards; consistent with a model in which trying as hard as you can is the best strategy. In contrast, favorable economic preference parameters (low discount rate, low risk aversion) are associated with increases in time investments when incentives are introduced, consistent with a rational economic model in which people only invest when there are monetary returns. The main conclusion is that individual behavior at cognitive tests depends on noncognitive skills.

Locus of control and consistent investment choices

“…Caliendo et al (2015) and McGee (2015) find that unemployed individuals with an internal locus of control invest more into job search than externally controlled individuals. Similarly, Cobb-Clark et al (2014) find that internally controlled individuals invest more into health capital and Borghans et al (2008) document that they perform better on cognitive tests. Cobb-Clark and Schurer (2013) show that they also accumulate more precautionary savings, and Salamanca et al (2016) find that internal locus of control is positively related to investments in risky assets.…”

“…If locus of control can have ambiguous effects on the quality of economic decisions, this has implications for the economic literature that analyzes the impact of non-cognitive skills on economic behaviors and outcomes (see, e.g., Borghans et al 2008, Chiteji 2010, or Grönqvist et al 2016. Non-cognitive skills are often viewed as characteristics that enhance the productive capacity of individuals.…”

The importance of early conscientiousness for socio-economic outcomes: evidence from the British Cohort Study

“…Becker et al (2012) empirically explore three datasets to link personality traits to economic preference parameters and find complementarity between the two. Borghans et al (2008b) find that performance motivation, fear of failure, internal locus of control, curiosity, low discount rates, and risk aversion are positively associated with more correct answers on a cognition test. Our results are also consistent with experimental evidence from Sutter et al (2012), who find that students with higher levels of impulse control fare better in school and are more likely to obtain good labour-market outcomes.…”

Non-cognitive skills and individual earnings: new evidence from PIAAC

“…Indeed, non-cognitive skills have been found to be important for performance on IQ tests due to the low stakes nature of the latter. As shown by Borghans et al (2008); Duckworth et al (2011);Gneezy and Rustichini (2000) and Segal (2012), scores of low performers on IQ tests can be improved by offering a reward. As mentioned above, some of this literature have explicitly proposed a decomposition of test scores into a cognitive and a non-cognitive component, see Borghans and Schils (2012).…”

“…Hedengren and Stratmann (2012) found that survey non-response is both correlated with cognitive and non-cognitive skills and, consequently, it may be interpreted as a measure of the two types of skills. Indeed, as recognized by Borghans et al (2008), separating cognitive ability from non-cognitive skills is not only empirically, but also conceptually complicated. However, in the line of Hitt et al (2016), we consider survey nonresponse to be a measure of non-cognitive skills rather than cognitive ability (despite being correlated with the two).…”