Why preschool should be universal

On Tuesday, May 5, I was asked to speak at a forum in Minnesota, on why I think that preschool should be universal rather than income-targeted. Below are my prepared remarks:

My main reason for arguing that publicly supported preschool should be universal is that the research evidence suggests that preschool’s benefits are universal. Preschool benefits for middle-class children are almost as large as benefits for lower-income children.

For example, the research evidence in a study I co-authored of Tulsa’s universal preschool program suggests that test score effects of pre-K for middle-income children are 90% as large as those for low-income children. Based on available studies of the relationship between early test scores and later earnings, we would also expect the dollar effects of Tulsa pre-K on future earnings for middle-class kids to be 90% as great.

These estimated earnings effects, for both middle class and low-income kids, are that for each dollar invested in pre-K, the present value of future earnings for those kids increases by about $5. This is a very favorable benefit-cost ratio for investing in both low-income and middle-class kids.

Even though the benefit-cost ratio is about the same for preschool for both middle-class and low-income kids, a universal preschool program would still significantly redistribute income. Because low-income children on average have lower baseline levels of future career earnings, the same dollar boost to earnings will cause a larger percentage boost to future earnings.

For example, in my work for Tulsa, I’ve calculated that a full-day preschool program costing $10,000 per year would boost the present value of future career earnings by about the same $50,000 for both low-income and middle-income children. But because expected future income is lower for low-income kids, this same $50,000 boost is about 10% of baseline career earnings for low=income kids, twice the 5% effect on career earnings for middle-class kids.

This evidence from Tulsa is backed up by similar evidence from Boston’s universal pre-K programs, and from random assignment experiments in both Utah and Rhode Island. The Boston and Rhode Island results for universal preschool programs suggest that preschool’s benefits for middle class children are 70% as great as for low-income children.

In contrast, the available evidence for earlier age interventions, such as parenting programs and child care programs for ages 0 to 2, suggests that they only pay off for low-income groups. For example, a study of one early child care program for ages 0-2, co-authored by Aaron Sojourner at the business school here, suggests that this program only helps children from families below 180% of the poverty line.

Why is there this pattern of benefits, in which preschool benefits all income classes, but earlier interventions in child care and parenting only benefit the poor? I think the most plausible explanation is the middle-class families are generally able on their own to provide adequate parenting or child care services. But high-quality preschool is hard for both middle-class parents and low-income parents to provide on their own. Preschool provides various skills, in particular social skills, that are best provided in a group setting. And quality preschool costs a lot: one school year of full-day high-quality preschool costs around $10,000, which is hard for many middle class families to afford on their own.

This interpretation of the research evidence is not my own unique view. A November 2014 “Consensus Letter” signed by over 500 early childhood researchers attempted to define the research consensus on early childhood education. Among other things, the letter stated that for programs such as preschool, and I quote, “benefits outweigh costs for children from middle-income… families.”

The economic research argument for universal preschool is backed up by some practical considerations. Universal programs are easier and cheaper to administer, without dealing with the complexities of income determination and recertification. Universal programs are less stigmatizing to the poor. Universal programs find it easier to encourage income mixing of children in preschool, which provides positive peer effects for low-income children. As argued in a recent report for The Century Foundation, economic diversity in a preschool program should be considered an important element of preschool quality – no-one thinks that running preschool in an income-segregated manner, as we do with Head Start, is ideal.  Finally, universal programs tend to have more persistent strong political support for maintaining access and program quality over time.

So in sum, I think that the research supports providing universal preschool at age 4, and income-targeted parenting and child care services for low-income children from the prenatal period to age 2. This combination of universal preschool services and targeted early age services will provide valuable benefits to all income classes, and boost the entire economy, while also providing an extra percentage boost to the poor and reducing income inequality.

About timbartik

Tim Bartik is a senior economist at the Upjohn Institute for Employment Research, a non-profit and non-partisan research organization in Kalamazoo, Michigan. His research specializes in state and local economic development policies and local labor markets.
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