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Skills and Earnings: A Multidimensional Perspective on Human Capital

Ludger Woessmann

Annual Review of Economics2025https://doi.org/10.1146/annurev-economics-081324-081733article
AJG 3ABDC A*
Weight
0.54

Abstract

The multitude of tasks performed in the labor market requires skills in many dimensions. Traditionally, human capital has been proxied primarily by educational attainment. However, an expanding body of literature highlights the importance of various skill dimensions for success in the labor market. This article examines the returns to cognitive, personality, and social skills, which are three important dimensions of basic skills. Recent advances in text analysis of online job postings and professional networking platforms offer novel methods for assessing a wider range of applied skill dimensions and their labor market relevance. Synthesis and integration of the evidence of the relationship between multidimensional skills and earnings, including the matching of skill supply and demand, will enhance our understanding of the role of human capital in the labor market.

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https://doi.org/https://doi.org/10.1146/annurev-economics-081324-081733

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@article{ludger2025,
  title        = {{Skills and Earnings: A Multidimensional Perspective on Human Capital}},
  author       = {Ludger Woessmann},
  journal      = {Annual Review of Economics},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.1146/annurev-economics-081324-081733},
}

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Skills and Earnings: A Multidimensional Perspective on Human Capital

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Evidence weight

0.54

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.52 × 0.4 = 0.21
M · momentum0.72 × 0.15 = 0.11
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.