Improving educational outcomes and narrowing the achievement gap for children from disadvantaged backgrounds would significantly increase long-term U.S. economic growth and raise government revenues, a report from the argues.
The report, (58 pages, PDF), analyzed the economic benefits of raising the educational achievement of children from the bottom 75 percent of the PISA index under three scenarios. In the best-case scenario, the lifetime earnings of children in the bottom quartile would increase 22 percent if the achievement gap were completely closed, and U.S. GDP in 2050 would be 10 percent higher with cumulative increases in GDP and government revenues over thirty-five years of $14.7 trillion and $5.3 trillion, respectively. The report also projected that, under the same scenario, GDP in 2075 would be 37.7 percent higher, with cumulative increases in GDP and tax revenues over sixty years of $86.5 trillion and $11.4 trillion.
According to the report, even in the other two scenarios, in which the achievement gap would be reduced from the current 18.6 percent to 16.0 percent and 13.2 percent, respectively, the cumulative gains in GDP and tax revenues would still be significant. The report further argues that investing in efforts to narrow educational achievement gaps — for example, expanding educational opportunities beyond school-specific reforms to include early childhood care and education, parenting support, criminal justice reform, and family-friendly workplace policies — would more than pay for themselves over the long run, in the form of higher GDP growth rates and increased government revenues.
"The reality in the United States is that persistent educational achievement gaps are generating a massive waste of both human talent and economic potential," said report author Robert Lynch, Everett E. Nuttle Professor of Economics at and a visiting fellow at the Washington Center for Equitable Growth. "By merely maintaining the status quo...the United States is throwing away enormous economic benefits that we could capture if we pursued policies that raised education achievement....The result of such investments is a twenty-first century economy where children can thrive and more fully contribute to America's future economy as highly skilled workers."