Destination countries can adopt selective immigration policies to improve migrants' quality. Screening potential migrants on the basis of observable characteristics also influences their self-selection on unobservables. We propose a model that analyzes the effects of selective immigration...

Census data from international sources covering 77% of the world's migrant population indicate that the skill composition of migrants in major destination countries, including the US, has been rising over the last 4 decades. Moreover, the population share of skilled migrants has been approaching...

Skill erosion during unemployment was of particular concern as unemployment duration increased in the Great Recession. I argue that it generates an externality in job creation: firms ignore how their hiring decisions affect the unemployment pool's skill composition, and hence the output produced...

While human capital is a strong predictor of economic development today, its importance for the Industrial Revolution has typically been assessed as minor. To resolve this puzzling contrast, we differentiate average human capital (literacy) from upper-tail knowledge. As a proxy for the...

We extend the Lucas' 1988 model introducing two classes of agents with heterogeneous skills, discount factors and initial human capital endowments. We consider two regimes according to the planner's political constraints. In the first regime, that we call meritocracy, the planner faces...

Using administrative data on schools in England, we estimate an education production model of cognitive skills at the end of secondary school. We provide empirical evidence of self-productivity of skills and of complementarity between secondary school inputs and skills at the end of primary...

We propose a model of schooling that can account for the observed heterogeneity in workers' productivity and educational attainment. Identical unskilled agents can get a degree at a cost, but becoming skilled entails an additional unobservable effort cost. Individual labor can then be used as an...