This paper assesses cross-country variation in life-cycle human capital accumulation, using new evidence fromUS immigrants. The returns to experience accumulated in an immigrant’s birth country before migrating are positively correlated with birth-country GDP per capita. To understand this fact, we build a model of life-cycle human capital accumulation that features three potential theories: differential human capital accumulation, differential selection, and differential skill loss.We use new data on the characteristics of immigrants and nonmigrants froma large set of countries to distinguish between these theories. The most likely theory is that immigrants from poor countries accumulate less human capital in their birth countries before migrating. Our findings imply that life-cycle human capital stocks are much larger in rich countries.
ASJC Scopus subject areas
- Economics, Econometrics and Finance(all)