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Does Empathy Pay? Evidence on Empathy and Salaries of Recent College Graduates

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Abstract

This paper examines linkages between empathy and salaries of recent college graduates. While it has been suggested that greater empathy enhances performance because empathic individuals work well with others and are good leaders, it is also possible that they will be less productive due to lower motivation to compete for pecuniary rewards or because they are considered to be too accommodating. Also, more empathic individuals may choose occupations that are more socially oriented and less well paid. We find a large, significant negative relationship between empathy and earnings for both men and women. While we cannot pinpoint the cause for this strong correlation or reach conclusions about causation, we find that empathic individuals choose college majors and sectors of employment that pay less. However, gender, major, and sector together do not account for the full negative relationship between empathy and salaries. While it seems likely that preferences lead more empathic people to choose lower paying occupations, we cannot eliminate the possibility that greater empathy has a negative effect on productivity.

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Notes

  1. For example, Barrick and Mount (1991) examine the relationship between personality and outcomes such as job proficiency, training proficiency, and personnel data. They find important linkages, but the correlations differed by occupation and the personality characteristics considered. Tett et al. (1991) conduct a meta-analysis of the predictive value of personality measures on job performance. Reviewing 97 studies, they conclude that personality traits predict job performance. Employers appear to agree, often giving job candidates personality tests before hiring them.

  2. In earlier work, economists referred to “hard” and “soft” skills (Duncan and Dunifon, 1978, 2012), but recently most use the terms “cognitive” and “noncognitive abilities.” However, Borghans et al. (2008) say they eschew the use of the term “noncognitive” because most human behavior includes some sort of cognition. Furthermore, cognitive processes affect personality and personality can influence measurements of cognitive ability.

  3. Traits can evolve over time as a function of own actions and skills, investments (such as parental nurturance, schooling, and learning by doing), and the situations the individual experiences.

  4. See Kamas and Preston (2019) for a detailed summary of this literature.

  5. See Kamas and Preston (2019) for a detailed discussion of the literature on measuring empathy.

  6. The IRI been validated in numerous studies (Davis 1980, 1983, Carey et al.,1988, Pulos et al. 2004, Hawk et al. 2013, Chrysikou and Thompson, 2016). It has also been shown that the IRI correlates with neurological measures of empathy (Singer et al. 2004, 2006, and Jabbi et al., 2007).

  7. See Kamas and Preston (2018) for a more detailed discussion of the experiment and surveys. The experiment instructions and survey are provided in the supplemental materials.

  8. In future work, when more years of surveys have been completed, we will examine the stability of empathy as measured as well as potential work/life effects on empathy. For the current measures the correlation of a response one year to a response in a future year is always above 0.8.

  9. We turned to instrumental variables to try to address the potential endogeneity of empathy and to differentiate the sorting story from the low productivity story. However, we were unable to find appropriate instruments in our data set. We used dummies for liberal political leanings and for non-heterosexual orientation as instruments, but in the total sample and subsamples where the empathy coefficient is negative and significant, the instruments do not pass minimum relevance tests; therefore, these results are not an improvement on estimates provided here.

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Funding

This work was funded by the Russell Sage Foundation, Haverford College, Santa Clara University, and the Leavey School of Business, Santa Clara University.

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Authors and Affiliations

  1. Department of Economics, Santa Clara University, 500 El Camino Real, Santa Clara, CA, USA

    Linda Kamas

  2. Department of Economics, Haverford College, 370 Lancaster Ave, Haverford, PA, 19041, USA

    Anne Preston

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  1. Linda Kamas
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Correspondence to Linda Kamas.

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Appendix

Appendix

Table 11 Full Models of Log Salary & Bonus Equations with Different Empathy Scales
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Kamas, L., Preston, A. Does Empathy Pay? Evidence on Empathy and Salaries of Recent College Graduates. J Labor Res 41, 169–188 (2020). https://doi.org/10.1007/s12122-020-09298-0

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