Tuesday, October 02, 2012

Hanushek and the economics of teacher quality

I recently finished reading The 4% Solution, a policy book released by the George W. Bush Institute. The chapters, including five by various Nobel laureates, look at what sparks economic growth, and what exactly it would take to make US GDP grow by 4 percent per year.

While people who don't share the former president's politics will find plenty to argue with in some of the essays, others are much more neutral politically, and focus on numbers. Eric A. Hanushek's essay on "Education Quality and Economic Growth" fits in this camp.

Hanushek studies the economics of education, and has done several studies into teacher quality. What teacher attributes affect student outcomes? In this essay he makes the case that increases in cognitive skills contribute to economic growth; basically, as people learn more and become better problem solvers, they use this knowledge and these skills to create efficiencies and new products and start businesses and so forth. He argues you can put specific dollar amounts on changes in US test scores on international assessments (particularly the PISA). If US achievement levels on the PISA rose by 25 points -- putting us at the level of Germany -- this would have a present value of $44 trillion for the United States over 80 years. Putting this in perspective, the entire US economy is currently $16 trillion. Getting up to the level of Finland -- one of the top countries -- would be worth $100 trillion over 80 years.

Hanushek then looks at the impact of teacher efficacy on student outcomes. His studies try to measure the "value added" contribution of teachers, looking at how different teachers instructing similar populations have wildly varying outcomes. He claims that replacing the least effective 5-8 percent of teachers with average teachers could bring the US up to a level of student achievement equivalent to that of Canada. Replacing the bottom 7-12 percent of teachers would eventually bring the US up to the level of Finland -- which was worth $100 trillion over 80 years. As he puts it, "the rewards for improvement are enormous. The economic benefits of reforming America's public schools far exceed the potential gains of a short-term focus on flattening out business cycles and from recovering from recession."

It's a fascinating concept, and if true, suggests a fairly stunning amount of economic growth almost there for the taking. But, of course, improving educational quality has been a long and not particularly successful battle. He notes that "The appropriate policies to achieve these changes in teacher quality are beyond this discussion." But hopefully some people will ponder that question, and come up with solutions that could put that $100 trillion in reach.


Anonymous said...

If we are going to say teachers make the difference, then we need to know what makes a good teacher.

Second thought, I see nothing in there about differentiation of instruction, or a national curriculum. How does our curriculum compare to Germany, Canada, and Finland.

Twin Mom said...

I always take these studies with a grain of salt. They seem to assume that low-skill work will disappear and that high-skill work will be available for the newly skilled people. It seems likely that the competition for high-skill work will just get tougher.

Bostonian said...

You can look after the fact and find that some teachers produced higher test scores than others from comparable students, but it is much harder to identify those teachers early in their careers. I am wary of an argument that goes as

Accomplishing X would be worth trillions of dollars.

It is possible that doing Y will accomplish X.

We must do Y!

Of course it is better to have good teachers than bad ones, but I'd rather discuss how to do that without throwing trillion dollar figures.

lgm said...

Germany, Canada, and Finland have options for students that include advanced classes, unlike many schools in the U.S. that have dropped their advanced classes in order to staff their remedial and special education classes. See "genuis denied"...

nicoleandmaggie said...

"They seem to assume that low-skill work will disappear and that high-skill work will be available for the newly skilled people."

It will. And as low skill work becomes more expensive domestically, it will be outsourced overseas or replaced by technology. The labor market is amazingly flexible. Yes, wages for high skill may go down relative to low skill, but productivity increases will mean more stuff for everybody.

Anonymous said...

Steve Sailer disaggregated the national PISA scores a year or two ago on his blog. There are world-wide and evidently unmoving racial differences in student achievement rooted in group differences in average IQ. If you compare only white American students to Finnish students, the PISA scores are about the same. The difference between the two countries is that United States has large black and Hispanic populations, while Finland is nearly all white. Although this demographic composition drags down the national average for the United States, it doesn't drag down the white average. When comparing apples to apples, the United States has nothing to be ashamed of next to Finland. Also, the amazing PISA scores for certain Chinese cities don't look so amazing when you compare them to the scores of Americans of East Asian descent, a group that scores even higher than white students. The United States' East Asian students do at least as well as their cousins in China on standardized achievement tests.

So, would Finland do better than the United States in bringing its black and Hispanic students to a higher achievement level (if it had any) than the United States does? There are reasons to doubt this. First, school integration and massive public investments in efforts to close the racial achievement gap in the United States haven't had much success in closing the achievement and IQ gaps. Furthermore, the United States must be doing something right with its expensive efforts to raise minority achievement levels over the last four or five decades, since there is surely no country in the world where black or Hispanic students outscore those in the United States. A fairer comparison than that of gross national averages would be to specifically compare US Hispanic students with students in Latin American countries; or US black students with students of Sub-Sarahan African descent in Europe, the Caribbean, and of course Africa. The former comparison is easily done: US Hispanic outscore Latin American students. No one, as far as I know, has done a study comparing how well different advanced Western countries with sizable black populations have done in educating these populations. This would of course be the fairest comparison of all. My suspicion is that the white/black gap would be found to be about equal in all such countries, and that it would be in the neighborhood of one standard deviation, which seems to be a universal constant in matters of cognitive ability. The racial gap is more likely an outcome of either 1) genetic factors reflecting divergent human evolutionary paths, or 2) early childhood environmental differences that school systems and public policy have little ability to affect, at least so far.

Laura Vanderkam said...

To anonymous - I am not sure how on earth it makes sense to compare American students to sub-Saharan African students, who in many cases are living in developing countries with substandard sanitation, roads, electricity, nutrition, to say nothing of schools, and thus feel better about the sub-par education many American students (of whatever racial background) are receiving. As for whether white students stack up against Finnish students, I found the most fascinating result of PISA comparisons to be that the top 10% of American students are far below the top 10% of high scoring countries, such as Finland. Even if those top 10% in the US aren't as diverse as we'd like (for whatever reason - I don't buy the genetic one), that would get closer to your comparisons of like students. And American students still aren't doing as well. The epidemic of low expectations affects almost all students in America -- of whatever background.