Early education

Lane Kenworthy, The Good Society
October 2017

Beginning in the 1960s, Denmark and Sweden introduced and then steadily expanded publicly-funded childcare and preschool. Today, most Swedish and Danish parents can put their child in a public or licensed private early education center from six months after birth up to kindergarten. The quality tends to be high, as teachers get training and pay comparable to elementary school teachers and teacher-student ratios are favorable. Parents pay a fee, but the cost is capped at less than 10% of a household’s income. In recent decades, a number of other affluent countries have moved toward this model.1

The United States led the way in establishing universal elementary and secondary schooling and in expanding access to college. But in early education, for children aged one to four, America lags well behind. As figure 1 shows, public spending on early education is quite low in the US. The same is true of children’s participation in early education, shown in figure 2.

Figure 1. Early education spending
Share of GDP. Government expenditures. Data sources: OECD Family Database; OECD Social Expenditures Database (for Canada and Switzerland). “Asl” is Australia; “Aus” is Austria.

Figure 2. Early education participation
Share of children. 2014. These data include public or private center-based services (nurseries, daycare centers, preschools), organized family day care, and care services provided by paid professional childminders. They exclude unpaid informal services provided by relatives, friends, or neighbors. Data source: OECD Family Database. “Asl” is Australia; “Aus” is Austria.

EARLY EDUCATION AND PARENTS’ EMPLOYMENT

Many Americans with prekindergarten children want to combine family with paid work.2 But out-of-home care can be prohibitively expensive. American parents with a child younger than age five in out-of-home care currently pay, on average, about $9,000 per year for that care. For families with incomes below $18,000 who pay for out-of-home care, the average cost amounts to 40% of household income. For those with incomes between $18,000 and $36,000, the average is 20% of income.3

Faced with such high costs, some parents settle for care that is mediocre or poor. A majority of out-of-home care is unregulated and unlicensed, and for infants and toddlers about two-thirds is. Most is judged to be of moderate or low quality.4 Other parents simply forgo employment. Among mothers whose youngest child is six to sixteen years old, and thus eligible for free K-12 schooling, the employment rate in the US is just a few percentage points lower than in Denmark and Sweden. Among mothers with a child younger than six, it’s 15 percentage points lower.5

EARLY EDUCATION AND EQUALITY OF OPPORTUNITY

Evidence increasingly suggests that good-quality early education helps to equalize opportunity by improving the capabilities of children from less advantaged homes.

Americans are strong believers in equality of opportunity. More than 90% think “our society should do what is necessary to make sure that everyone has an equal opportunity to succeed.” But family conditions are a big impediment. Some children have parents who read to them, instill helpful traits such as self-control and persistence, shield them from stress and physical harm, expose them to new information and learning opportunities, assist them with homework, provide connections that help them get out of trouble or into a good job, remain in a stable relationship throughout the childhood years, and so on. Other children are less fortunate. As a result, whereas an American born into a family in the top fifth of incomes has roughly an 80% chance of ending up in the middle fifth or higher in adulthood, an American born into the bottom fifth has only a 30% chance of reaching the middle fifth or higher.6

Schools help to offset the massive differences in capabilities caused by families. How do we know that? Children from poor homes tend to have much lower measurable skills than children from affluent homes at kindergarten entry. Given the huge variation in home and neighborhood circumstances, we would expect that gap to continue to widen throughout childhood. But it doesn’t; it’s about the same size at the end of high school. This tells us that schools have an equalizing effect.7 Also, during summer vacations, when children are out of school, those from lower-income families tend to fall farther behind.8

Having children enter school earlier in life could reduce the disparity when they arrive for kindergarten. Indeed, some analysts conclude that the impact of schooling is larger before kindergarten than after.9

The effects of three high-quality early education programs in the United States — the Perry Preschool Program in Michigan in the 1960s, the Abecedarian Project in North Carolina in the 1970s, and the Child-Parent Center Education Program in Chicago in the 1970s — have been tracked into early adulthood or beyond. Each program appears to have had positive effects for low-income children that persist throughout the life course. That’s also the case with Head Start, with a large-scale though short-lived childcare program put in place in the 1940s during World War II, and with early education in Denmark and Norway.10

For the Perry and Chicago Programs, gains in test scores faded away but there were long-term gains in labor market success and other outcomes. The same appears to be true for Head Start and for Norway’s universal early education program. This suggests that the key improvement is in noncognitive skills more than in cognitive ability. On the other hand, the Abecedarian Project yielded better long-term behavioral outcomes along with sustained gains in test scores. A natural experiment in Denmark also found lasting test-score gains. So early education’s benefits for children from less advantaged homes may come via both cognitive and noncognitive skills.

Skeptics point to findings of little apparent impact of existing universal preschool programs for four-year-olds in Oklahoma and Georgia. But these programs are too new to assess long-run effects.11

The Nordic countries, particularly Denmark and Sweden, have had universal early education systems in place for a generation. Consequently, in these nations a relatively large share of young children from lower-income families enroll in center-based care, as figure 3 shows. This may help account for why opportunity is more equal — children’s cognitive abilities, likelihood of completing high school and college, and labor market success depend less on their parents’ education, income, and parenting practices — in these countries than in others.12

Figure 3. Early education participation in low-income families
Share of children age 0 to 2. Households with incomes in the bottom third. 2014. These data include public or private center-based services (nurseries, daycare centers, preschools), organized family day care, and care services provided by paid professional childminders. They exclude unpaid informal services provided by relatives, friends, or neighbors. Data source: OECD Family Database, using EU-SILC data. “Aus” is Austria.

The most informative test is one that looks at differences across countries in changes over time.13 If early education helps to equalize opportunity, we would expect a greater equalization over time in countries that adopted universal early education, such as Sweden and Denmark, than in countries that didn’t. According to Gøsta Esping-Andersen, that is indeed what happened: “I use the IALS [International Adult Literacy Survey] data to compare social origin effects on the probability of completing upper-level secondary education across birth cohorts…. The analyses follow three cohorts, the oldest born in the late 1940s and early 1950s; the youngest in the 1970s. And I compare ‘social inheritance’ trends in the three Nordic countries with Germany, the UK, and the US. The results are very consistent with a ‘constant flux’ scenario in Germany, the UK, and the US. In these countries we see no decline whatsoever in the impact of origins on educational attainment across the cohorts — which is to say, over a half century…. In contrast, there is a very significant decline in the association in all three Scandinavian countries, and the drop occurs primarily in the youngest cohort — the first to enjoy near-universal participation in child care.”14

So affordable, good-quality early education would improve work-family balance and likely would reduce inequality of opportunity.15

HOW EARLY?

Research suggests children tend to fare best staying with a parent during the first year of life.16 Along with facilitating early education for kids aged one to four, therefore, it may be good to have a paid parental leave program to enable a parent to stay home during part or all of the first year.

TARGETED OR UNIVERSAL?

Since resources are limited, one option for expanding early education is to do so mainly or exclusively for children from less advantaged homes.17 The other is the universal approach we use for K-12 education, with all children eligible. The argument for universalism is threefold. First, it isn’t just low-income parents who struggle to find good-quality care that’s affordable. Middle-class parents do too. Second, family structure and parents’ traits and behaviors are key sources of disadvantage, and they don’t overlap perfectly with family income. If we target low-income households, we’ll miss many children who need help. Third, development of cognitive and especially noncognitive skills is aided by peer interaction. Children from less advantaged homes gain by mixing with kids from middle-class homes, which doesn’t happen in a program that exclusively serves the poor.18

PUBLIC AND PRIVATE

A good early education system will combine three features: accessibility, affordability, and quality. For Americans able and willing to pay a lot for childcare, our current market-based system typically delivers all three. But for those with low to moderate incomes, getting access to affordable care often means sacrificing quality, as noted above.

To make early education affordable for all, public funding is needed. Government already is involved: the federal government funds Head Start, some special education services, and tax breaks for childcare, and some state governments fund preschool for four-year-olds and subsidize childcare for poor families. Yet current funding is nowhere near sufficient to ensure that everyone has access to good-quality care and preschool. The bill to taxpayers would depend on specific details, but a rough estimate for a universal, high-quality early education system is 1% of GDP, or $180 billion, per year.19

Should government also provide early education? Those who say yes contend that this is needed in order to guarantee universal access to preschool and care that’s above an acceptable quality threshold. On the other hand, it isn’t necessary that government be the sole provider. Denmark and Sweden allow private providers, as long as they meet quality standards. In many districts across the US we allow private providers for publicly-funded K-12 schooling (charter schools), and we allow private doctors and hospitals to provide medical care for Medicare and Medicaid recipients.

What’s the ideal mix? We don’t know. Maybe it’s 25% of kids in public early education centers, or perhaps it’s 75%. This depends on how many private providers can combine good quality with a reasonable rate of return.

SUMMARY

Affordable, high-quality early education would facilitate work-family balance for American parents, and the best available evidence suggests it would enhance opportunity for children who grow up in less-advantaged homes.


  1. OECD, Starting Strong II: Early Childhood Education and Care, 2006; OECD, Doing Better for Families, 2011; Miriam Nordfors, “What Preschool Means in Sweden,” New York Times: Room for Debate, 2013; OECD Family Database. 
  2. Americans used to worry about mothers of young children working outside the home. In the late 1970s, 68% believed “a preschool child is likely to suffer if his or her mother works.” But by 2016, the share had shrunk to 28% (General Social Survey, series fepresch). Indeed, nowadays support for paid work among mothers of young kids spans the political spectrum. Many conservatives favor strict time limits on receipt of government benefits in order to encourage mothers’ employment, and gender egalitarians point out that four or five years out of the work force (more if there is a second or third child) puts women at a severe disadvantage for later employment and earnings. See Ron Haskins, Work Over Welfare, Brookings Institution Press, 2007; Janet C. Gornick, Marcia K. Meyers, et al, Gender Equality, Verso, 2009. 
  3. Lynda Laughlin, “Who’s Minding the Kids? Child Care Arrangements: Spring 2011,” US Census Bureau, 2013, table 6, using data from the Survey of Income and Program Participation (SIPP). See also Ajay Chaudry et al, “Child Care Choices of Low-Income Working Families,” Urban Institute, 2011; ChildCare Aware of America, “Parents and the High Cost of Child Care,” 2012. 
  4. Laughlin, “Who’s Minding the Kids?”; Erik Ruzek, Margaret Burchinal, George Farkas, and Greg J. Duncan, “The Quality of Toddler Child Care and Cognitive Skills at 24 Months: Propensity Score Analysis Results from the ECLS-B,” Early Childhood Research Quarterly, 2014. See also Deborah Lowe Vandell and Barbara Wolfe, “Child Care Quality: Does It Matter and Does It Need to Be Improved?” Special Report 78, Institute for Research on Poverty, University of Wisconsin-Madison, 2000; Jane Waldfogel, What Children Need, Harvard University Press, 2006; W. Steven Barnett et al, The State of Preschool 2012, National Institute for Early Education Research; Jonathan Cohn, “The Hell of American Day Care,” The New Republic, 2013. 
  5. OECD, Doing Better for Families, figure 1.9. For more comparative evidence, see Olivier Thévenon, “Drivers of Female Labor Force Participation in the OECD,” OECD Social, Employment, and Migration Working Papers No. 145, 2013. For Denmark-specific evidence, see Marianne Simonsen, “Availability and Price of High Quality Day Care and Female Employment,” Working Paper 2005-08, Department of Economics, University of Aarhus, 2005. In the United States, the labor force participation rate for mothers wth a child age 6 to 17 is 75%. For mothers with a child under age 6, it’s only 65%. Bureau of Labor Statistics, “Employment Characteristics of Families,” using Current Population Survey data. For additional US-specific evidence, see Janice Compton and Robert A. Pollak, “Family Proximity, Childcare, and Women’s Labor Force Attachment,” Working Paper 17678, National Bureau of Economic Research, 2011; Elizabeth U. Cascio and Diane Whitmore Schanzenbach, “The Impacts of Expanding Access to High-Quality Preschool Education,” Working Paper 19735, National Bureau of Economic Research, 2013. Timothy Bartik concludes that the employment benefits of early education are not just in the quantity of jobs but also their quality. See Bartik, Investing in Kids: Early Childhood Programs and Local Economic Development, W.E. Upjohn Institute for Employment Research, 2011. 
  6. Lane Kenworthy, “Equality of Opportunity,” The Good Society. 
  7. James J. Heckman, “Schools, Skills, and Synapses,” Working Paper 14064, National Bureau of Economic Research, 2008; Sean F. Reardon, “The Widening Academic-Achievement Gap Between the Rich and the Poor: New Evidence and Possible Explanations,” in Whither Opportunity?, figure 5.5; John Ermisch, Markus Jäntti, and Timothy Smeeding, eds., From Parents to Children: The Intergenerational Transmission of Advantage, Russell Sage Foundation, 2012, pp. 465-468; Bruce Bradbury, Miles Corak, Jane Waldfogel, and Elizabeth Washbrook, Too Many Children Left Behind, Russell Sage Foundation, 2015, chs. 4-6. 
  8. Douglas B. Downey, Paul T. von Hippel, and Beckett A. Broh, “Are Schools the Great Equalizer? Cognitive Inequality during the Summer Months and the School Year,” American Sociological Review, 2004; Karl L. Alexander, Doris R. Entwisle, and Linda Steffel Olson, “Lasting Consequences of the Summer Learning Gap,” American Sociological Review, 2007; David M. Quinn and Morgan Polikoff, “Summer Learning Loss: What Is It, and What Can We Do about It?,” Brookings Institution, 2017. For discussion of additional findings from natural experiments in which children go without schooling, see Richard E. Nisbett, Intelligence and How to Get It, W.W. Norton, 2009, ch. 3. 
  9. Jeanne Brooks-Gunn, “What We Can Expect from Early Childhood Intervention Programs,” Society for Research in Child Development, 2003; Heckman, “Schools, Skills, and Synapses”; Douglas Almond and Janet Currie, “Human Capital Development Before Age Five,” Working Paper 15827, National Bureau of Economic Research, 2010. 
  10. Heckman, “Schools, Skills, and Synapses”; David Deming, “Early Childhood Intervention and Life-Cycle Skill Development: Evidence from Head Start,” American Economic Journal: Applied Economics, 2009; Arthur J. Reynolds et al, “Age 26 Cost-Benefit Analysis of the Child-Parent Center Early Education Program,” Child Development, 2011; Gøsta Esping-Andersen, Irwin Garfinkel, Wen-Jui Han, Katherine Magnuson, Sander Wagner, and Jane Waldfogel, “Child Care and School Performance in Denmark and the United States,” Children and Youth Services Review, 2012; Greg J. Duncan and Katherine Magnuson, “Investing in Preschool Programs,” Journal of Economic Perspectives, 2013; Chris M. Herbst, “Universal Child Care, Maternal Employment, and Children’s Long-Run Outcomes: Evidence from the U.S. Lanham Act of 1940,” IZA Discussion Paper 7846, 2013; Hirokazu Yoshikawa, Christina Weiland, et al, “Investing in Our Future: The Evidence Base on Preschool,” Society for Research in Child Development and Foundation for Child Development, 2013; Timothy J. Bartik, From Preschool to Prosperity, Upjohn Institute for Employment Research, 2014; Pedro Carneiro and Rita Ginja, “Long-Term Impacts of Compensatory Preschool on Health and Behavior: Evidence from Head Start,” American Economic Journal: Economic Policy, 2014; Tarjei Havnes and Magne Mogstad, “Is Universal Child Care Leveling the Playing Field?,” Journal of Public Economics, 2015. 
  11. Duncan and Magnuson, “Investing in Preschool Programs.” See also W. Steven Barnett, “Getting the Facts Right on Pre-K,” National Institute for Early Education Research, 2013. 
  12. Gøsta Esping-Andersen, The Incomplete Revolution, Polity, 2009, ch. 4; Havnes and Mogstad, “Is Universal Child Care Leveling the Playing Field?”; Ermisch, Jäntti, and Smeeding, eds., From Parents to Children. 
  13. Lane Kenworthy, “How Do We Know?,” The Good Society. 
  14. Esping-Andersen, The Incomplete Revolution, pp. 135-36. 
  15. A possible third benefit is faster economic growth. If universal early education increases employment by mothers and improves the capabilities of Americans who grow up in less advantaged homes, it may boost the economy’s growth rate. But there are grounds for skepticism. Though the Nordic countries have had universal early education for several decades, their economies don’t grow more rapidly now than they used to. Nor do they (apart from oil-rich Norway) grow faster than other affluent nations. If early education does increase economic growth, its impact probably is small enough that it’s overshadowed by the myriad other determinants of national growth rates. A fourth potential benefit is higher fertility. Families that know having a child won’t severely interrupt the work career of either the father or mother are more likely to have the number of children they desire. If we look across Europe, countries with universal early education tend to have higher fertility rates; see Francis G. Castles, “The World Turned Upside Down: Below Replacement Fertility, Changing Preferences, and Family-Friendly Public Policy in 21 OECD Countries,” Journal of European Public Policy, 2003; OECD, Doing Better for Families, ch. 3; Esping-Andersen, The Incomplete Revolution. But this doesn’t seem to be a significant barrier to fertility in the United States. 
  16. Waldfogel, What Children Need, ch. 2; Jeanne Brooks-Gunn, Wen-Jui Han, and Jane Waldfogel, “First-Year Maternal Employment and Child Development in the First Seven Years,” Monographs of the Society for Research in Child Development, 2010; Maria del Carmen Huerta et al, “Early Maternal Employment and Child Development in Five OECD Countries,” OECD Social, Employment, and Migration Working Paper 118, 2011; Ajay Chaudry, Taryn Morrissey, Christina Weiland, and Hirokazu Yoshikawa, Cradle to Kindergarten, Russell Sage Foundation, 2017. 
  17. Chaudry et al, Cradle to Kindergarten. 
  18. Eric A. Hanushek, John F. Kain, Jacob M. Markman, and Steven G. Rivkin, “Does Peer Ability Affect Student Achievement?,” Working Paper 8502, National Bureau of Economic Research, 2001; Heckman, “Schools, Skills, and Synapses”; Robert Bauchmüller, Mette Gørtz and Astrid Würtz Rasmussen, “Long-Run Benefits from Universal High-Quality Preschooling,” AKF Working Paper, 2011; Barnett, “Getting the Facts Right on Pre-K”; Elizabeth U. Cascio, “Does Universal Preschool Hit the Target? Program Access and Preschool Impacts,” Working Paper 23215, National Bureau of Economic Research, 2017. 
  19. Lane Kenworthy, “A Better America,” The Good Society.