This paper reviews the recent literature on measuring and fostering cognitive and non- cognitive skills. IQ tests and achievement tests do not adequately capture non- cognitive skills personality traits, goals, character, motivations, and preferences that are valued in the labour market, in school, and in many other domains. For many outcomes, their predictive power rivals or exceeds that of cognitive skills. Evidence from the General Educational Development (GED) testing programme in the United States shows the importance of non-cognitive skills.