The Productivity Argument for Investing in Young Children

T his article presents the case for investing more in young American children who grow up in disadvantaged environments.Figure 1 graphs time series of alternative measures of the percentage of children in disadvantaged families.The percentage of children born into, or living in, nontraditional families has increased greatly in the past thirty years. 1,2 Approximately 25% of children are now born into single parent homes.While the percentages of children living in poverty and born into poor families have fallen recently, they are still high, especially among certain subgroups.Adverse environments place children at risk for social and economic failure.The accident of birth plays a powerful role in determining adult success. 3 Many have commented on this phenomenon, and most analyses have cast the issue of assisting children from disadvantaged families as a question of fairness or social justice.This article makes a different argument.We argue that, on productivity grounds, it makes sense to invest in young children from disadvantaged environments.Substantial evidence shows that these children are more likely to commit crime, have out-of-wedlock births, and drop out of school.Early interventions that partially remediate the effects of adverse environments can reverse some of the harm of disadvantage and have a high economic return.They benefit not only the children themselves, but also their children, as well as society at large.Investing in disadvantaged young children is a rare public policy with no equity-efficiency tradeoff.It reduces the inequality associated with the accident of birth and at the same time raises the productivity of society at large.