New evidence on the role of human capital in economic development

This study provides new evidence on the role of human capital in economic development by investigating the earnings and occupational attainment of immigrants in Venezuela. The results show that immigrants are representative of the source country's population and are more likely to use their skills in the labour market of the host country. This allows us to measure the human capital endowments of the source countries more precisely. Using the standard development accounting framework to explain the variation in output, the study finds that physical capital and human capital account for 73-79% of income differences across countries.