Thank Your Kindergarten Teacher for Your Next Pay Raise

Although motivated parents jockey to get their children into the classes with well-regarded teachers, and many education policy researchers staunchly defend the importance of high-quality teachers for student outcomes, finding evidence that quality teachers make much of a difference to the life success of students is devilishly tricky.

Empirical problems abound — student outcomes often reflect unobserved selection bias into classrooms, high quality test data are difficult to obtain, and later life outcomes on earnings and assets are rarely available to researchers.

A recent study by researchers at Harvard, Berkeley, and Northwestern plausibly addresses all of these empirical problems by linking data from Tennessee STAR (a randomized experiment on teacher quality and class size from the 1990s) to financial records from the study cohort in their mid 20s. The results are astounding.The study finds a large and significant association between kindergarten test scores and earnings later in life.

For each 1 percentile point increase in kindergarten test scores, the students’ yearly adult earnings increase by $130— or almost 1% of mean earnings — measured between ages 25 and 27.

High scoring students were also much more likely to be homeowners, to live in better neighborhoods, and to have retirement savings.

The researchers went back to the experimental data to compare students with better and lower ranked teachers (ex. those ranked at the 25th percentile and those ranked at the 75th percentile). Going from a low to high quality teacher improves annual income by 3.5 percent yearly — or $10,000 annually.

When you multiply that by 20 students in each class, the additional lifetime bene- fits from a single year of high-quality kindergarten teaching is about $320,000.

Like most longitudinal studies of early education, the authors show that early test score gains fade out and disappear in later grades. Conventional wisdom thus far has concluded that this shows that “fade out” shows that children do not retain the advantage from high quality early education. So why does the effect of early education make a reappearance later on? Plausibly, some of the effect may be transmitted through non-cognitive skills, such as attentiveness and appropriate social behavior. A large literature shows that non-cognitive skills are associated with success in the labor market.

Translating these findings into policy is challenging. First, there is not a single tried and true method for improving teacher quality — some people stress that the best strategy is to pay more for the best and brightest (but even so, predicting which talented undergraduates will make good teachers is an imperfect science). Second, there is not much consensus about how to teach children at a young age non-cognitive skills, and whether doing so should come at the expense of making students better test takers. Kendra has written about the drawbacks of high stakes testing in a previous post.

Finally, there is a big thorny question about how seriously we should lean on the cost benefit estimate the authors advance. Ben has raised some concerns about the naive application of CBA in social policy, and many of the concerns he raises could apply here too.

A nice summary of the profiled article is available here.

About Brendan Saloner

I am a postdoctoral fellow at the University of Pennsylvania in the Robert Wood Johnson Health and Society Scholars Program. I completed a PhD in health policy at Harvard in 2012. My current research focuses on children's health, public programs, racial/ethnic disparities, and mental health. I am also interested in justice and health care.
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