within representative-agent RBC models. In these models, the introduction of education can increase the volatility of hours worked (see Einarsson and Marquis, 1998, for example). Within a life-cycle framework this result no longer holds because some agents are less likely to substitute work with schooling (e.g. high types). Nevertheless, Model1 remains our preferred specification because it is able to explain why we observe differences in productivity at work among individuals.