The role of cognitive skills in economic development revisited.

Abstract

Students’ test scores at ages 9 to 15 are a measure of their skills as workers five to 55 years later. Using historic data on test scores and school attendance, I calculate the share of workers in 2005 that could have scored above 400 and above 600 in 45 countries. I find that the share above 400 and average schooling attainment cause national income, while the share above 600 and the share with post-secondary schooling do not. Implicitly the best long-term development strategy for poor countries is to increase the share of students who complete primary and secondary schooling.