Parents'Earnings and the Returns to Universal Pre-Kindergarten

Abstract

This paper asks whether universal pre-kindergarten (UPK) programs can increase parental earnings and, if so, how much these gains affect the economic returns to UPK. Using admissions lotteries for an extended-day UPK program in New Haven, Connecticut, we find that UPK enrollment increases childcare coverage to span the workday and raises parents’ earnings by 21.7% during pre kindergarten. Gains persist for at least six years. We find little evidence of effects on children’s academic and behavioral outcomes during elementary and middle school. Combining these results, we demonstrate that tax revenues from parents’ earnings gains reduce the net government costs of UPK by 90% relative to estimates that ignore gains for parents. Overall, we estimate that each dollar spent yields $10 in benefits. Our findings demonstrate the potential of UPK programs that combine quality education with full-day childcare and underscore the importance of thinking about parents when designing and evaluating early-childhood policies