The Effects of Investing in Early Education on Economic Growth

Many in Congress and the administration have called for new investments in education in order to make the United States more competitive, with President Bush stressing the importance of education in preparing young Americans to “fill the jobs of the 21st century.” Yet advocates of early childhood education have only recently stressed the economic benefits of preschool programs, and it has been difficult to win support for these short-term investments given the long-term nature of the benefits to the economy.

This policy brief analyzes the impact of a high-quality universal preschool policy on economic growth, concluding that such a policy could add $2 trillion to annual U.S. GDP by 2080. By 2080, a national program would cost the federal government approximately $59 billion, but generate enough additional growth in federal revenue to cover the costs of the program several times over.