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The Economic Case for Investments in Young Children. Rob Grunewald and Art Rolnick Federal Reserve Bank of Minneapolis. Educational Characteristics of the Labor Force Millions of Workers Age 25 and Over. Source: Ellwood (2001). Four Numbers to Remember. 700 per second

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the economic case for investments in young children
The Economic Case for Investments in Young Children

Rob Grunewald and Art Rolnick

Federal Reserve Bank of Minneapolis

educational characteristics of the labor force millions of workers age 25 and over
Educational Characteristics of the Labor ForceMillions of Workers Age 25 and Over

Source: Ellwood (2001)

four numbers to remember
Four Numbers to Remember

700 per second

18 months

2:1 ratio

3:1 odds

slide4
Human Brain at Birth

14 Years Old

6 Years Old

4

slide5
Human Brain DevelopmentSynapse Formation Dependent on Early Experiences

Language

Higher Cognitive Function

Sensory Pathways

(Vision, Hearing)

FIRST YEAR

-8 -7 -6 -5 -4 -3 -2 -1 1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

Birth

(Months)

(Years)

Source: C. Nelson (2000)

slide6
Barriers to Social Mobility Emerge at a Very Young Age

1200

College Educated Parents

600

Cumulative Vocabulary (Words)

Welfare Parents

200

16 mos.

24 mos.

36 mos.

Child’s Age (Months)

Source: Hart & Risley (1995)

slide7
Risk Factors for Adult Substance Abuse are Embedded in Adverse Childhood Experiences

Self-Report: Alcoholism Self-Report: Illicit Drugs

40

16

35

14

%

%

30

12

25

10

20

8

15

6

10

4

5

2

0

0

ACEs

0

1

2

3

4

5+

0

1

2

3

4

Source: Dube et al, 2002 Source: Dube et al, 2005

risk factors for adult depression are embedded in adverse childhood experiences
Risk Factors for Adult Depression are Embedded in Adverse Childhood Experiences

5

4

3

Odds Ratio

2

1

0

1

2

3

4

5+

ACEs

Source: Chapman et al, 2004

slide9
Risk Factors for Adult Heart Disease are Embedded in Adverse Childhood Experiences

3.5

3

2.5

Odds Ratio

2

1.5

1

0.5

0

1

2

3

4

5,6

7,8

ACEs

Source: Dong et al, 2004

high scope study of perry preschool
High/Scope Study of Perry Preschool
  • In early 1960s, 123 children from low-income families in Ypsilanti, Mich.
  • Children randomly selected to attend Perry or control group.
  • High-quality program with well trained teachers, daily classroom sessions and weekly home visits.
  • Tracked participants and control group through age 40.
perry educational effects
Perry: Educational Effects

Source: High/Scope Educational Research Foundation

perry economic effects at age 40
Perry: Economic Effects at Age 40

Source: High/Scope Educational Research Foundation

perry arrested 5 or more times before age 40
Perry: Arrested 5 or More Times Before Age 40

Source: High/Scope Educational Research Foundation

perry average number of months served in prison by age 40
Perry: Average Number of Months Served in Prison by Age 40

Source: High/Scope Educational Research Foundation

perry preschool costs and benefits over 62 years
Perry PreschoolCosts and Benefits Over 62 Years

Source: High/Scope Educational Research Foundation

perry preschool estimated return on investment
Perry Preschool — Estimated Return on Investment
  • Benefit-Cost Ratio = $16 to $1
  • Annual Rate of Return = 18%
  • Public Rate of Return = 16%
abecedarian educational child care
Abecedarian, Educational Child Care

Full-day, year-round program near Chapel Hill, N.C. Children from low-income families were randomly selected to attend Abecedarian or control group.

abecedarian educational and health effects
Abecedarian: Educational and Health Effects

Source: Carolina Abecedarian Study

chicago child parent centers
Chicago Child-Parent Centers

Half-day, large-scale program in Chicago public schools. Comparison group was a sample of eligible nonparticipants.

chicago child parent centers20
Chicago Child-Parent Centers

Source: Arthur Reynolds, et al.

elmira prenatal early infancy project higher risk families
Elmira Prenatal/Early Infancy ProjectHigher-Risk Families

Home visiting program by registered nurses for at-risk mothers, prenatal through first two years of child’s life. Randomly selected participants were compared with a control group.

benefit cost ratios for other longitudinal studies
Benefit-Cost Ratios for Other Longitudinal Studies
  • Abecedarian Educational Child Care
    • $4 to $1
  • Chicago-Child Parent
    • $7 to $1
  • Elmira Prenatal/Early Infancy Project
    • $5 to $1
short run benefits
Short-Run Benefits
  • Allow parents to enter workforce
  • Reduce absenteeism and turnover
  • Attract businesses
lessons learned from research
Lessons Learned from Research
  • Invest in quality
  • Involve parents
  • Start early
  • Reach at-risk population
  • Teach cognitive and noncognitive skills
  • Bring to scale
moving forward
Moving Forward
  • Prenatal/early infant home visits for at-risk mothers
  • Access to health care
  • Parent education
  • Quality child care
  • Access to preschool
business leadership in early childhood development
Business Leadership in Early Childhood Development
  • Partnership for America’s Economic Success & Committee for Economic Development
  • Success By 6 – United Way
  • PNC Financial Services, Gates Foundation
  • Minnesota Early Learning Foundation
slide29
“Although education and the acquisition of skills is a lifelong process, starting early in life is crucial. Recent research – some sponsored by the Federal Reserve Bank of Minneapolis in collaboration with the University of Minnesota – has documented the high returns that early childhood programs can pay in terms of subsequent educational attainment and in lower rates of social problems, such as teenage pregnancy and welfare dependency.”

Remarks by Federal Reserve Board Chairman Ben S. Bernanke

Before the Greater Omaha Chamber of Commerce,

February 6, 2007

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