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Education appears to be one of the key factors that drive economic
mobility. As shown in Figure 6-10, among families in the bottom fifth of
the income distribution, almost half (45 percent) of the children who did
not obtain college degrees remained in the poorest fifth as adults, while
only one-sixth (16 percent) of the children who obtained college degrees
remained in the poorest fifth (Isaacs, Sawhill, and Haskins 2008: 95).
The importance of education is also shown by the findings that economic
mobility is higher in countries that have a greater public expenditure
on education (Ichino, Karabarbounis, and Moretti 2009) and areas of the
United States that have a higher-quality K-12 education system (Chetty,
Hendren, Kline, and Saez 2014), and is improved for children in the poorest
one-third of families when states increase spending on elementary and
secondary education (Mayer and Lopoo 2008).
Intergenerational Returns
While much of the literature on mobility presented above is correlational,
a handful of well-crafted studies that track the long-run outcomes of
children exposed to safety net programs highlight the potential for investments
in these programs to generate large returns.
Early childhood education has been found by many researchers to
have dramatic, super-normal returns in terms of more favorable adult
outcomes. The Head Start program created early in the War on Poverty has
been heavily researched and the combined results show that it can “rightfully
be considered a success for much of the past fifty years” (Gibbs, Ludwig, and
Miller 2013: 61). Studies following children over time, and accounting for
the influence of family background by comparing siblings, found that Head
Start participants were more likely to complete high school and attend college
(Garces, Thomas, and Currie 2002), and scored higher on a summary
index of young adult outcomes that also included crime, teen parenthood,
health status, and idleness (Deming 2009). The latter study found that Head
Start closed one-third of the gap in the summary outcome index between
children in families at the median and bottom quartiles of family income.
Using a regression discontinuity research design that compared access to
Head Start across counties, Ludwig and Miller (2007) found positive impacts
of Head Start on schooling attainment, the likelihood of attending college,
and mortality rates from causes that could be affected by Head Start. Gibbs,
Ludwig, and Miller (2013) suggest the combination of the benefits due to
Head Start might produce a benefit-cost ratio in excess of seven.
Randomized experiments studying the Perry Preschool Project,
Abecedarian Project, Chicago Child-Parent Centers, Early Training Project,
and Project CARE programs largely confirm these findings. A variety of
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