Facts In Action

Although high quality early care and education (ECE) may seem expensive, its investment is key to improving the lives of children and families. Through cost-benefit analyses, a process of adding up and comparing the costs and benefits of a project and/or program, researchers have determined that high quality early childhood programs provide children and taxpayers with short- and long-term benefits that on average are greater than the estimated costs.

In a RAND Corporation study of nine early childhood programs, they found that participants of high quality early childhood programs experienced significant social, intellectual, and financial advantages over non-participants:

• Most of the participants that were at-risk of dropping out of school and engaging in criminal behavior were more likely to avoid these decisions and actions.
• At least in the short-term period, participants maintained significantly higher grades in school and higher IQ scores.
• As the participants became adults, they were more likely to have a job and earn a higher salary.

In a more recent study, the University of Pittsburgh - Office of Child Development provided updated information on how certain programs paid off for each dollar invested. In two of the early education programs examined, the Abecedarian Project (NC) and the Perry Preschool Program (MI), the estimated cost-benefit ratio resulted in approximately $4 gained for every $1 invested, while the Chicago Child-Parent Center (IL) resulted in $7 for every $1 invested.

Nonetheless, both of the studies concluded that not enough programs undergo a cost-benefit analysis and out of those that have, few can be cited as an accurate financial picture of the program evaluated. So while cost-effectiveness demonstrates the need to continue implementing high quality early care intervention programs, it also points to the need to invest in continued research and development as a way to ensure greater progress tomorrow.

Sources: Goark, C., Mehaffie, K., McCall, R., and Greenberg, M. (2003) Investing Today for Tomorrow: The Costs and Benefits of Early Childhood Care and Education. http://dil.sched.pitt.edu/ocd/publications/govtaskforce1.pdf

Karoly, L., et al. (1998) Investing in Our Children: What We Know and Don't Know About the Costs and Benefits of Early Childhood Interventions. http://www.rand.org/publications/MR/MR898/Editor's note: This url has changed:http://www.rand.org/pubs/monograph_reports/MR898/index.html

Facts in Action, July 2004