Schools, skills, and synapses

Economic Inquiry, July, 2008 by James J. Heckman

I. INTRODUCTION

American society is polarizing. Proportionately more American youth are graduating from college than ever before. At the same time, American-born youth are graduating from high school at lower rates than 40 years ago.

This paper reviews and interprets these trends. The origins of inequality are examined and policies to alleviate it are analyzed. Families play a powerful role in shaping adult outcomes. The accident of birth is a major source of inequality. Recent research by Cunha and Heckman (2007a, 2008b) shows that about half of the inequality in the present value of lifetime earnings is due to factors determined by age 18. Compared to 50 years ago, relatively more American children are being born into disadvantaged families where investments in children are smaller than in advantaged families. Policies that supplement the child rearing resources available to disadvantaged families reduce inequality and raise productivity.

The argument of this paper is summarized by the following 15 points:

1. Many major economic and social problems such as crime, teenage pregnancy, dropping out of high school, and adverse health conditions are linked to low levels of skill and ability in society.

2. In analyzing policies that foster skills and abilities, society should recognize the multiplicity of human abilities.

3. Currently, public policy in the U.S. focuses on promoting and measuring cognitive ability through IQ and achievement tests. The accountability standards in the No Child Left Behind Act concentrate attention on achievement test scores and do not evaluate important noncognitive factors that promote success in school and life.

4. Cognitive abilities are important determinants of socioeconomic success.

5. So are socioemotional skills, physical and mental health, perseverance, attention, motivation, and self confidence. They contribute to performance in society at large and even help determine scores on the very tests that are commonly used to measure cognitive achievement.

6. Ability gaps between the advantaged and disadvantaged open up early in the lives of children.

7. Family environments of young children are major predictors of cognitive and socioemotional abilities, as well as a variety of outcomes such as crime and health.

8. Family environments in the U.S. and many other countries around the world have deteriorated over the past 40 years. A greater proportion of children is being born into disadvantaged families including minorities and immigrant groups. Disadvantage should be measured by the quality of parenting and not necessarily by the resources available to families.

9. Experimental evidence on the positive effects of early interventions on children in disadvantaged families is consistent with a large body of non-experimental evidence showing that the absence of supportive family environments harms child outcomes.

10. If society intervenes early enough, it can improve cognitive and socioemotional abilities and the health of disadvantaged children.

11. Early interventions promote schooling, reduce crime, foster workforce productivity and reduce teenage pregnancy.

12. These interventions are estimated to have high benefit-cost ratios and rates of return.

13. As programs are currently configured, interventions early in the life cycle of disadvantaged children have much higher economic returns than later interventions such as reduced pupil-teacher ratios, public job training, convict rehabilitation programs, adult literacy programs, tuition subsidies, or expenditure on police.

14. Life cycle skill formation is dynamic in nature. Skill begets skill; motivation begets motivation. Motivation cross-fosters skill and skill cross-fosters motivation. If a child is not motivated to learn and engage early on in life, the more likely it is that when the child becomes an adult, he or she will fail in social and economic life. The longer society waits to intervene in the life cycle of a disadvantaged child, the more costly it is to remediate disadvantage.

15. A major refocus of policy is required to capitalize on knowledge about the importance of the early years in creating inequality in America, and in producing skills for the workforce.

The evidence assembled in this paper substantially amends the analysis of The Bell Curve by Herrnstein and Murray (1994). Those authors made an important contribution to academic and policy analysis by showing that cognitive ability, as captured by achievement test scores measured in a child's adolescent years, predicts adult socioeconomic success on a variety of dimensions. Heckman, Stixrud, and Urzua (2006) and Borghans, Duckworth, Heckman, and ter Weel (2008) demonstrate that personality factors are also powerfully predictive of socioeconomic success and are as powerful as cognitive abilities in producing many adult outcomes. Achievement tests of the sort used by Herrnstein and Murray reflect both cognitive and noncognitive factors.

The Bell Curve assigned a primary role to genetics in explaining the origins of differences in human cognitive ability and a primary role to cognitive ability in shaping adult outcomes. If cognitive ability is genetically determined and is primary in shaping adult outcomes, public policy towards disadvantaged populations is limited to transfer payments to the less able. Recent research, summarized in this paper, establishes the power of socioemotional abilities and an important role for environment and intervention in creating abilities. The field of epigenetics surveyed in Rutter (2006) demonstrates how genetic expression is strongly influenced by environmental influences and that environmental effects on gene expression can be inherited. Evidence is presented in this paper that high quality early childhood interventions foster abilities and that inequality can be attacked at its source. Early interventions also boost the productivity of the economy.