McKinsey put out a report yesterday looking at the economic cost of poor educational performance through the fairly clever gimmick of asking what would the economic benefit be of closing various kinds of “achievements gaps” that can be found in the American school system. Some findings:
— If the United States had in recent years closed the gap between its educational achievement levels and those of better-performing nations such as Finland and Korea, GDP in 2008 could have been $1.3 trillion to $2.3 trillion higher. This represents 9 to 16 percent of GDP.
— If the gap between black and Latino student performance and white student performance had been similarly narrowed, GDP in 2008 would have been between $310 billion and $525 billion higher, or 2 to 4 percent of GDP. The magnitude of this impact will rise in the years ahead as demographic shifts result in blacks and Latinos becoming a larger proportion of the population and workforce.
— If the gap between low-income students and the rest had been similarly narrowed, GDP in 2008 would have been $400 billion to $670 billion higher, or 3 to 5 percent of GDP.
— If the gap between America’s low-performing states and the rest had been similarly narrowed, GDP in 2008 would have been $425 billion to $700 billion higher, or 3 to 5 percent of GDP.
To make a long story short, having a high-performing school system is extremely valuable. This is important to keep in mind when talking about spending money on schools or other social services aimed at children and their parents. There’s much more to improving educational outcomes than spending money at random, but insofar as you identify a use for the money that’s genuinely useful it’s worth spending extremely freely. This is worth mentioning because reasonable doubts are often raised about the scalability of certain promising, but limited in scope, educational models that charter school networks have been put into play. Insofar as the scalability problem is simply a question of it looking improbable that a requisite amount of money can be found, then there’s good reason to believe that it would be worth setting that worry aside and just finding the money.
In other words, we can understand this as part of the reason that some of the high-tax social democracies are so successful. It’s not, per se, that high levels of taxation don’t dampen economic activity. But the high-quality social service those taxes are financing, reflected in things like very good educational outcomes, provide a more-than-offsetting boost.
Meanwhile, I thought this chart was fascinating. On the Y axis you get average PISA scores, and on the X axis you get the percent of variance in student performance that can be accounted for in terms of socioeconomic status:
There’s an impressive amount of variance along both axes. And there also isn’t a really clear trend here. You normally expect to see Finland clustered with Denmark and Sweden rather than with Japan and Canada.