Trade, Education and Skills: A Theoretical Survey

This paper reviews the literature that relates trade, education and skills formation,intending to provide a theoretical background to policy discussions in education matters. The paper is organised as follows. Section 1 summarises the literature on education and human capital in trade models. Section 2 focuses on education as an investment and the process of human capital accumulation. Section 3 deals with the returns to education. Section 4 analyses the economic literature on the education production function and on issues of effectiveness, efficiency and quality. Section 5 discusses the public provision of education. Section 6 presents some concluding remarks.