The High Cost of Low Educational Performance. Eric A. Hanushek Ludger Woessmann

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1 The High Cost of Low Educational Performance Eric A. Hanushek Ludger Woessmann

2 Key Questions Does it matter what students know? How well is the United States doing? What can be done to change things?

3 Answers to Key Questions Yes. It matters a lot how much students know. Not so well. U.S. students are not competitive internationally. Improving teacher quality is key. Nothing about schools is as important as highly effective teachers. Improving teacher quality meets with considerable resistance.

4 Education Quality and Economic Growth

5 Quantity of Schooling With quality control Without quality control

6 Finland Denmark Germany Iceland Sweden Norway France Italy Netherlands Korea Belgium Uruguay Spain Czech_Republic Greece Portugal Switzerland Brazil Austria OECD mean Ireland New_Zealand Hungary Israel Argentina Chile United_Kingdom United_States Australia Luxembourg Slovak Republic Poland Tunisia Mexico Paraguay Jamaica Jordan Malaysia Thailand Russian_Federa Turkey Indonesia Philippines Zimbabwe years of attainment Expected Schooling, 2003 Even developing countries go farther!

7 Hong Kong-China Finland Korea Netherlands Liechtenstein Japan Canada Belgium Macao-China Switzerland Australia New Zealand Czech Republic Iceland Denmark France Sweden Austria Germany Ireland OECD average Slovak Republic Norway Luxembourg Poland Hungary Spain Latvia United States Russian Portugal Italy Greece Serbia Turkey Uruguay Thailand Mexico Indonesia Tunisia Brazil Mathematics Performance on PISA, 2003 Our competitors also learn more each year of school! standard deviations from OECD average

8 Simulations of Quality Improvement Growth follows same pattern as past four decades Growth directly related to human capital of workers measured by international math and science tests School reform takes time (assumed 20 years)

9 Calculating the Benefits of Reform Improved schools take time to impact average skills of workers (2.5% replaced each year) Growth without improvement at 1.5% Present value of reform bonus discounted at 3% Calculated for lifetime of person born today

10 Percent addition to annual GDP Annual Gains from 25 Point Improvement 60% 50% 40% 30% 20% 10% 0% Year

11 Percent addition to annual GDP Annual Gains from 25 Point Improvement 60% 50% 40% 30% 20% 10% 0% Year

12 Mexico Turkey Greece Portugal Italy Luxembourg Spain United States Poland Norway Slovak Republic OECD Hungary Denmark Germany Iceland France Ireland Sweden Austria Switzerland Belgium Czech Republic United Kingdom Australia New Zealand Canada Netherlands Japan Korea Finland % of Current GDP Catching Up to Finland 1000% 800% 600% 400% 200% 0%

13 Mexico Turkey Greece Portugal Italy Luxembourg Spain United States Poland Norway Slovak Republic OECD Hungary Denmark Germany Iceland France Ireland Sweden Austria Switzerland Belgium Czech Republic United Kingdom Australia New Zealand Canada Netherlands Japan Korea Finland % of Current GDP Catching Up to Finland 1000% 800% $103T 600% 400% 200% 0%

14 Mexico Turkey Greece Portugal Italy Luxembourg United States OECD Spain Poland Germany Norway Hungary Slovak Republic Belgium France Denmark Austria Sweden Iceland Switzerland Czech Republic Ireland United Kingdom New Zealand Australia Netherlands Japan Canada Korea Finland % of Current GDP Bringing Up the Bottom 600% 400% 200% 0%

15 Mexico Turkey Greece Portugal Italy Luxembourg United States OECD Spain Poland Germany Norway Hungary Slovak Republic Belgium France Denmark Austria Sweden Iceland Switzerland Czech Republic Ireland United Kingdom New Zealand Australia Netherlands Japan Canada Korea Finland % of Current GDP Bringing Up the Bottom 600% $72T 400% 200% 0%

16 Scale Scores National Assessment of Educational Progress (NAEP), age math reading science w riting Test subject

17 Public School Resources Pupil-teacher ratio Master s degree 23.5% 49.6% 56.8% Experience $/pupil (2006 $ s) $2,541 $5,823 $8,691

18 s.d. performance gain The Cost of Bad Teachers Finland 0.50 Canada % 2% 4% 6% 8% 10% 12% Percent deselected high estimate of teacher effectiveness low estimate of teacher effectiveness

19 Key Questions Does it matter what students know? How well is the United States doing? What can be done to change things?

20 Answers to Key Questions Yes. It matters a lot how much students know. Not so well. U.S. students are not competitive internationally. Improving teacher quality is key. Nothing about schools is as important as highly effective teachers. Improving teacher quality meets with considerable resistance.

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