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Using longitudinal data from the Youth in Transition Survey (YITS), designed by Statistics Canada in conjunction with the OECD's Programme for International Student Assessment (PISA), we examine the ability of PISA test scores to predict subsequent educational and labor market success. Overall, our results indicate that performance on both components of the PISA assessment is much more predictive of success in the labor market than of academic success or the probability of obtaining a degree in a scientific field. Our findings suggest that the OECD is partially justified in claiming that the PISA program measures individuals' ability to solve practical, real-world problems rather than simply assessing knowledge acquired directly through school curricula. However, given the strong correlation between performance on the two components of the assessment and the virtual absence of any difference in their predictive power, we cannot rule out the possibility that the competencies measured by the PISA program are influenced by a common latent factor akin to general intelligence—one of the most common criticisms directed at the statistical design of the PISA assessment.
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