Economics of Early Education
Benefits and Costs of
Quality Early Education for All
Presentation to the
Pre-Kindergarten Education Study Committee
Vermont General Assembly
October 27, 2006
W. Steven Barnett, Ph.D.
National Institute for Early Education Research
www.nieer.org
1
Impacts of Quality Early Education
Increased Educational Success and Adult Productivity
 Achievement test scores
 Special education and grade repetition
 High school graduation
 Behavior problems, delinquency, and crime
 Employment, earnings, and welfare dependency
Decreased Costs to Government
 Schooling costs
 Social services costs
 Crime costs
 Health care costs (teen pregnancy and smoking)
2
Randomized Trials

Long Term





Perry Preschool, IDS, Early Training Project
Abecedarian, Milwaukee, CARE
IHDP (not Disadvantaged), Houston PCDC
Mauritius Preschool Study
Short Term



National Early Head Start
National Head Start
Many smaller scale studies
3
Quasi-Experimental Studies:
Follow-up Into School Years




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



Chicago Child Parent Center Study (12th grade)
Michigan School Readiness (4th grade)
South Carolina Pre-K (1st grade)
New York Pre-K (3rd Grade)
Ludwig & Miller Head Start (12th grade +)
RAND National study of 4th grade NAEP
Belfield & Schwartz ECLS-K (5th grade)
Cost Quality and Outcomes (3rd grade)
Vandell NICHD Early Care and Education
Early Provision of Preschool Education (England)
4
Strong Quasi-Experimental Studies:
New Results at Kindergarten


Georgetown U., Tulsa, OK (All)
NIEER, Rutgers U.
OK (All)
 WV (All)
 AR (Disadvantaged)
 MI (Disadvantaged)
 SC (Disadvantaged)
 NJ (All in 31 districts with high poverty)

5
Three Benefit-Cost Analyses
with Disadvantaged Children
Abecedarian Chicago
High/Scope
Year began
1972
1985
1962
Chapel Hill, NC Chicago, IL Ypsilanti, MI
Location
Sample size
111
1,539
123
Matched
Design
RCT
RCT
neighborhood
Ages
Program
schedule
6 wks-age 5
Ages 3-4
Full-day, year Half-day,
round
school year
Ages 3-4
Half-day,
school year
6
High/Scope Perry Preschool:
Educational Effects
Program group
No-program group
15%
Special Education
(Cog.)
34%
49%
Age 14 achievement
at 10th %ile +
15%
66%
Graduated from high
school on time
0%
45%
10%
20%
30%
40%
50%
60%
70%
7
High/Scope Perry Preschool:
Economic Effects at Age 27
Program group
No-program group
Earn $2,000 +
monthly
29%
7%
36%
Own home
13%
41%
Never on welfare as
adult
0%
20%
10%
20%
30%
40%
50%
8
High/Scope Perry Preschool:
Economic Effects at 40
Source: Schweinhart et al., 2005
Program group
No-program group
60%
Earned > $20K
40%
76%
Employed
62%
76%
Had Savings
Account
0%
50%
10%
20%
30%
40%
50%
60%
70%
80%
9
High/Scope Perry Preschool:
Arrests per person by age 27
Felony
Program
0.7
No program
1.2
Misdemeanor
0.5
1.5
0.0
Juvenile
2.3 arrests
2.5
1.0
2.0
0.6
3.0
4.0
4.6 arrests
5.0
6.0
10
Perry Preschool: Crime Effects at 40
Source: Schweinhart et al. 2005
Program group
No-program group
36%
Arrested > 5X
55%
33%
Violent Crime
48%
14%
Drug Crime
34%
0%
10%
20%
30%
40%
50%
60%
11
Abecedarian : Academic Benefits
Program group
No-program group
25%
Special Education
48%
31%
Grade Repeater
55%
67%
HS Graduation
51%
36%
4 Yr College
0%
13%
10%
20%
30%
40%
50%
60% 70%
80%
12
Abecedarian Reading Ach. Over Time
READING SCORE
105
100
95
90
85
TREATMENT
CONTROL
80
8
10
12
14
16
18
20
22
AGE (Years)
13
Abecedarian Math Achievement Over Time
MATH SCORES
105
TREATMENT
CONTROL
100
95
90
85
80
8
10
12
14
16
18
20
22
AGE (Years)
14
Chicago CPC: Academic and
Social Benefits at School Exit
Program group
No-program group
50%
HS Graduation
39%
14%
Special Education
25%
23%
Grade Repeater
38%
17%
Juvenile Arrest
0%
25%
10%
20%
30%
40%
50%
60%
15
Economic Returns to Pre-K
for Disadvantaged Children
Cost
Benefits
B/C

Perry Pre-K
$16,264
$277,631
17.07

Abecedarian
Chicago
$36,929
$ 7,417
$139,571
$ 52,936
3.78
7.14

16
Perry Preschool
Costs
Program Cost
$15,386
Benefits
K-12 Schooling
$8,556
Child Care
$919
Welfare
$774
Employment
$79,743
Crime
$173,959
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Abecedarian
Costs
Benefits
K-12
Schooling
$8,836
Program Cost
$63,476
Future
Employment
$5,722
Health
Smoking
$17,781
Welfare
$196
Maternal
Employment
$68,728
Child Care
$27,612
Employment
$37,531
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Chicago CPC
Costs
Program Cost
$7,584
Benefits
Child Care
$1,878
K-12 Schooling
$5,521
Crime
$15,023
Welfare
$535
Abuse/Neglect
$338
Employment
$31,459
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Could Universal Pre-K Produce
Similar Benefits for the Middle Class?
Middle class children have fairly high rates of the
problems that preschool reduces for low-income
children.
Reducing these problems could generate large benefits.
Income
Lowest 20%
20-80%
Highest 20%
Retention
17%
12%
8%
Dropout
23%
11%
3%
Source:US Department of Education, NCES (1997). Dropout rates in the United
States: 1995. Figures are multi-year averages.
20
Access to Any Pre-K or Child Care Center
21
Cognitive Readiness Gap—Half as Big at
Median as for the Poor (bottom 20%)
Abilities
Scores
Abilities of Entering Kindergarteners by Family Income-National Data, Fall 1998 (reported by NIEER from ECLS-K)
60.0
55.0
Reading
School Readiness Gap
Math
50.0
General
Knowledge
45.0
40.0
Low est 20%
2nd Low est
20%
Middle 20%
2nd Highest
20%
Highest 20%
Fam ily
Incom e
22
Social Readiness Gap—Half as Big at the
Median as for the Poor (bottom 20%)
Social
Scores
Social Skills of Entering Kindergarteners by
Family Income (NIEER Analysis of ECLS-K)
9.80
9.60
9.40
School Readiness Gap
9.20
9.00
Social
Skills
8.80
8.60
8.40
Family
Income
8.20
8.00
Lowest 20%
2nd Lowest 20%
Middle 20%
2nd Highest 20%
Top 20%
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Effects of Today’s Programs

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New rigorous studies
Large scale public (Head Start & State)
One year of quality public Pre-K at 4
Effects of policy at entry to Kindergarten
Universal and targeted programs
Standardized tests
Estimate effects by income and ethnicity
24
Oklahoma’s Pre-K for All




3,028 children in Tulsa public schools
Rigorous RD design
Gains for all SES & ethnic groups
Literacy and Math gains



Smaller than Perry and Abecedarian
Similar to CPC
Larger gains for minority and poor children
Source: Gormley et al. (2004). CROCUS/Georgetown University
25
NIEER Evaluation of
6 State Pre-K Programs
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Over 6,000 children in 6 States
OK and WV are for all children
NJ for all children in 31 districts
AR, MI, & SC targeted
Gains from Pre-K in all 6 states
Gains in language, literacy & math
All children gain, low-income gain more
Source: Barnett et al. (2005). NIEER/Rutgers University, plus new AR report.
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Oklahoma 4th Grade NAEP Scores
Before and After Pre-K for All
YEAR
2002 Reading
2003 Reading
2005 Reading
2000 Math
2003 Math
2005 Math
White
220
220
219
Black
188
195
196
Hisp.
197
200
204
Indian
209
206
211
229
235
240
205
211
217
207
220
226
221
225
229
Reading gains are not statistically significant; math gains are
statistically significant for Whites and Hispanics (2000-05). 27
Georgia 4th Grade Math NAEP
Scores Before and After Pre-K
YEAR
1996
White
224
Black
201
Hispanic
205
2000
230
204
217
2003
241
217
219
2005
243
221
229
Gains from before to after UPK are statistically significant.
28
Georgia 4th Grade Reading NAEP
Scores Before and After Pre-K
YEAR
1998
White
221
Black
191
Hispanic
Not Avail.
2002
226
200
200
2003
226
199
201
2005
226
199
203
Gains from 1998 to 2005 are statistically significant.
29
Is Targeting More Cost-Effective?
Targeting is costly and imperfect



Poverty is a moving target
Need is not defined by poverty alone
Accurate identification is difficult
Benefits do not stop at the poverty line


Middle class has similar problems
Benefits decrease gradually with income
30
Comparing Targeted Pre-K
and Pre-K for All
Targeted Pre-K has Lower Cost
Pre-K for All Children:
Reaches all disadvantaged children
Produces larger gains for disadvantaged
Produces good gains for children
Yield larger net benefits
Source: Barnett (2004). Maximizing returns from pre-kindergarten
education. Federal Reserve Bank of Cleveland Research Conference.
31
High Quality Preschool Programs
Needed to Produce Benefits
 Well-educated, adequately paid teachers
 Good curriculum and professional development
Small classes and reasonable teacher:child ratios
Strong supervision, monitoring, and review
High standards and accountability
32
Conclusions

Preschool can be a sound investment

High quality is needed for high returns

High standards and adequate resources are
necessary but not sufficient

Plan-Do-Review is also needed

Universal can be more cost-effective
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