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Early childhood education: How important are the cost-savings to the school system?

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Belfield, Clive R.
Publication Date: 
1 Feb 2004


The report describes the medium-term benefits or cost-savings from Early Childhood Education in: reducing the incidence of special education; preventing grade repetition; improving educational productivity; and enhancing children's well-being. It also estimates the medium-term cost-savings to the state from investment in ECE programs.

This report reviewed 19 published research studies of early childhood education programs from around the nation, and analyzed their outcomes relevant to the New York State school spending.

To evaluate education spending, we use a balance sheet format that compares costs with benefits. The benefits of early education range from immediate improvement in school readiness, to mid-range cuts in school spending, to long-term impacts on job-holding, income and home-ownership. The analysis presented in this study focuses on medium-term benefits to school system efficiency, through reductions in special education and grade repetition and increases in learning productivity. Based on analysis of outcomes from published studies, we calculate the size of cost-savings related directly to education.

Overall, pre-K benefits offset 41% to 62% of total spending on early childhood education. These benefits represent savings of about 1.9% to 2.8% of total education expenditures in New York State.