We provide first evidence on the relationship between cognitive abilities and earnings in Germany using data from the German Socio-Economic Panel (SOEP) Study. The estimates suggest that mechanics abilities are positively related to wages of West German workers, even when educational attainment...

Following German unification in 1990, a number of initial studies were conducted on the development of the returns to education in the eastern states of the former GDR. These studies reveal a general consensus of initial falls in the returns to education for the eastern states (Krueger and...