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This paper analyzes self-selection of returning immigrants. We propose an empirical model for this purpose, and apply it to Israeli-born immigrants who arrived in the United States during 1970-79 and returned to Israel during 1980-89. The results, based on analyses of the 5 per cent Public Use Microdata Samples (PUMS) of the 1980 and 1990 United States censuses, suggest that those who return from the United States to Israel have reached a higher level at school than those who remain in the United States. However, the income analysis suggests that, at each schooling level, those who returned to Israel would have been less successful in the United States labour market than Israelis of similar schooling (and other measured characteristics) who remained in the United States. These results were corroborated using Israeli census data that include information on returning Israelis. [ABSTRACT FROM AUTHOR]