The importance of preschool education for child developmentand international experiences in expanding coverage

Presentation by Jan van Ravens at the conference on:Investing in Early Childhood Education in Serbia

25 September 2012

Hotel Park, Belgrade

Economics of Early Childhood On a purely economic basis, it makes a lot of sense to invest in the young Early learning begets later learning. And early success breeds later success.--James J. Heckman, Ph.D.Nobel Prize LaureateEconomist

Ramey & Ramey (1999). American Psychologist. Engle, P. (2005). Developmental Readiness.Early Intervention and Early Childhood

Approach 1: comparing countriesThis analysis was published in the leading journal The Lancet (23 September 2011)Authors compared low and middle income countries with a total of 2.7 billion inhabitantsUsed three scenarios: 25% , 35% or 50% increase in preschool enrolmentEstimated the gains in terms of educational attainment and, from there, of GNP growthAnd found a benefit to cost ratio of 6.4 to 17.6 (depending on initial preschool enrolment; on discount rate; and on which scenario)

Approach 2: comparing childrenA preschool program in the USAComparing treatment group and control group Benefit to cost ratio of 17, by the age of 40Benefits and costs per participant in US$ (constant 2000) and with 3% discount rate

Disadvantaged children benefit most

A quick look into the Black Box

Looking to the West......

For Serbia: enrolment in pre-primary in 2009 at ages 3-5.5: 48%For EU-countries: enrolment in pre-primary among 3 and 4 year olds in 2005-2006.For UK: only 3 year olds. At age 4, 90% of children are either in pre-primary or primary

... and looking to the EastEnrolment at ages 3-6 by GDP per capitaNote: from international data-base. Data for Serbia may differ from national sources.

Wealth disparities(% children 36-59 months attending early education)

Short programs seem 4 to 6 times less costly than full-day programs

CurrencyUnit cost full-dayUnit cost half-dayRatio:full / halfArmeniaUS$21634.26.32KyrgyzstanSom601016703.60MacedoniaDenar71590111396.43PolandZloty450012003.75

Short or Fullday: some examplesKyrgyzstan: rapid expansion of short programs, initiated by NGOs but taken ove by GovernmentPoland: where there are no PreschoolsBig differences in West-Europe, for example:Belgium. From age 2.5 onwards: fullday care in small groups with close to 100% enrolment in public institutions. Same in France and Italy.Netherlands. Only from age 4: school-based program of 5 hours per day on average in large groups. No meals or beds. Childcare mainly private. Special programs for disadvantaged.

How to finance scale upExpand gradually: first from age 4, then from age 3Use existing preschool budget:Raise efficiencyRaise full-day fee selectively (social justice)Use demographic dividend:Use existing space in schoolsRetrain primary teachers

Main conclusionsSerbia has every chance to expand coverage of preschool education, provided that we:promote enrolment in short programs, andconvince parents who do not need daycareSerbia should first focus on the poorest but eventually aim at universal coverage:48% of the children are already on board!children in the middle groups benefit as well(A Vision for Universal Preschool Education. Zigler, Gilliam and Jones, 2006)

*The cumulative deficit, shown here, represents the idea that the later the investment in improved caring for a child , the wider the gap that has to be closed. This is illustrated by showing the top curve, which represents the normal course of development, and the bottom curve, which shows the course of development for a child who is developmentally delayed - in other words, has a slower rate of development, and may be at risk for mental retardation.

The key message is that the later you intervene, the greater the gap that has to be closed.

The Y axis (vertical) is the childs developmental level - both cognitive and social. The X axis (horizontal) is the age period. The list of factors on the right side of the graph represent all of the factors that may affect the magnitude of the developmental delay. Some of these are characteristics of the individual, such as responsiveness, and others are characteristics of the situation (timing, intensity of the intervention, breadth of the intervention), and a third refer to cultural and developmental appropriateness.

This chart is from Ramey and Ramey, Am Psychologist. (1999).

*One of the most well-known findings of this study is that the preschool program had a large return on investment. The best estimate, using a 3% discount rate, which is similar to an interest rate over and above inflation, is that for each dollar invested, the program returned $12.90 to the public and $4.10 to participants, for a total return of $17.07. As the graph shows, the sources of the return were savings in welfare, education due to less need for special education classes, greater earnings of participants, higher taxes paid on greater earnings, and both criminal justice system and victim costs of crime. Savings in crime costs alone were over 11 times the cost of the program, but even with the crime savings, the program paid for itself.

Some would say at $8,500 a year per child, the program is too expensive. But the public cost of every poor child who does not receive this program is not zero, but almost $200,000. Why do we keep choosing to spend $200,000 on big problems that we could prevent by spending $15,000? Government deficits are real, large, and growing. A major reason for them is our failure to make early childhood investments that significantly reduce our social problems before they get out of hand.