Investing
in public education earns high marks for greater upward mobility
Penn State
Investing in education may help boost economic opportunities for the next generation, according to a team of economists.
In a study,
researchers suggest that investing in public education can lead to more upward
economic mobility and lower teen pregnancy rates, as well as provide a way to
ease income inequality.
"It's something
we've long suspected, but this study really confirms that there's a strong link
between the quality of the schools you go to and the opportunities you have
later in life," said Stephan Goetz, professor of agricultural and regional
economics, Penn State and director of the Northeast Regional Center for Rural
Development. "The better your school, the better your economic
opportunities."
The study, which
focused on public spending in education and returns from education, as well as
taxation, indicated that communities that invested more in education had lower
drop-out rates and fewer teen pregnancies.
The researchers, who released their findings in a recent issue of Economic Development Quarterly, added that reducing the high school dropout rate had nearly twice the beneficial effect on upward mobility as on reducing teen birth rates.
According to the
researchers, poor school quality can lead to a cascade of economic and social
ills. For example, the lower the school quality, the higher the dropout rate,
which can lead to higher numbers of teen pregnancies, said Goetz.
"Because the
dropout rate negatively affects both teen birth rates and absolute upward
mobility, this shows that school quality not only has short-term impacts on
educational outcomes, but also has long-term impacts on children's success as
adults," said Goetz.
The researchers also
said that, often, the only way up economically for young people in rural communities
is to move out.
"One finding --
that rural young people rely on moving out of the area to move up in the income
rankings -- presents a challenge for policy makers who not only care about
prosperity for people, but also for places," said Minghao Li, a former
graduate student in rural agricultural, environmental and regional economics,
Penn State, and now a postdoctoral researcher at Iowa State.
"To be able to retain talented children, rural areas need to create high-skilled jobs and favorable environments for start-up entrepreneurs."
"To be able to retain talented children, rural areas need to create high-skilled jobs and favorable environments for start-up entrepreneurs."
Mobility varies
throughout the nation, according to the researchers. For example, upward
mobility is higher in the Rocky Mountains and Plains regions and in portions of
Oklahoma and Texas, while it is lower in the Northeast and Far West.
The researchers used
data from federal income tax records, the Historical Database on Individual
Government Finances, the Local Education Agency Finance Survey from 1991 to
2000, theAmerican Community Survey from 2006 to 2010, and County Business
Patterns.
Goetz and Li also
worked with Bruce Weber, emeritus professor and director of the Rural Studies
Program, Oregon State University.
The United States
Department of Agriculture and the National Institute of Food and Agriculture
supported this work.