Working Paper: NBER ID: w10229
Authors: Eric A. Hanushek
Abstract: Most empirical analyses of human capital have concentrated solely on the quantity of schooling attained by individuals, ignoring quality differences. This focus contrasts sharply with policy considerations that almost exclusively consider school quality issues. This paper presents basic evidence about the impact of school quality on individual earnings and on economic growth. The calculations emphasize how benefits relate to both the magnitude and the speed of quality improvements. It then considers alternative school reform policies focused on improvements in teacher quality, identifying how much change is required. Finally, teacher bonus policies are put into the context of potential benefits.
Keywords: school quality; economic growth; teacher quality; individual earnings
JEL Codes: J3; H4; I2; E6
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Improvements in school quality (I21) | Higher individual earnings (J31) |
| One standard deviation increase in mathematics performance (C29) | Higher individual earnings (J31) |
| Improvements in school quality (I21) | Enhanced productivity and growth at the macroeconomic level (O49) |
| Quality of the labor force (J24) | Economic performance (P17) |
| Higher school quality (I21) | Economic growth (O00) |
| 10-year reform plan yielding a one standard deviation improvement in student performance (D29) | Annual dividend exceeding total expenditure on K-12 education (H52) |
| Quality of school (I21) | GDP per capita (O49) |