Investing in Our Young People

Abstract

This paper reviews the recent literature on the production of skills of young persons. The literature features the multiplicity of skills that explain success in a variety of life outcomes. Noncognitive skills play a fundamental role in successful lives. The dynamics of skill formation reveal the interplay of cognitive and noncognitive skills, and the presence of critical and sensitive periods in the life-cycle. We discuss the optimal timing of investment over the life-cycle.

Keywords: skill formation, cognitive skills, noncognitive skills, technology of skill formation, investment in children

JEL Classification: J13, J24, D91