This project takes as its starting point the potential for beliefs to shape lives. This is an important focus of educational psychology and child development, and in the last 15 years has also become an important topic in development economics. This project works to understand how information, both correct and incorrect, contributes to inequality in the formation of human capital. This work draws heavily on insights from the economics of beliefs and information, and from decades of psychology research on child development. It focuses on the role of societal stereotypes – beliefs that certain groups, such as those defined by gender or ethnicity, are inherently inferior to others. It shows that these stereotypes can be a key source of information that children process to understand the world and their place in it. In an ongoing series of studies, this project examines how gender and racial stereotypes persist across space and time, measures their negative consequences for students, and evaluates policies designed to weaken stereotypes and reverse historical patterns of exclusion.