J-PAL Youth Initiative REVIEW PAPER March 2013

Adolescence is a time when critical decisions must be made—for example, about schooling, careers, fertility—that can dramatically impact the future trajectory of lives. It is also a period in which habits with potential longer-term consequences are formed, including smoking, drug use, eating habits that may increase the risk of diabetes and obesity, or sexual activity patterns. Young people’s skills, both cognitive and noncognitive, can have a significant effect on how well they are able to navigate the transition from childhood to adulthood.Consequently, cognitive abilities have been the primary focus of public policies aiming to rectify inequalities in economic outcomes. However, a large body of evidence has shown that noncognitive skills, such as perseverance, motivation, time preference, risk aversion, self-esteem, and self-control, are strongly predictive of life outcomes from wages to the probability of engaging in high-risk behavior.