The Heckman Equation: Early Childhood Education Benefits All

“Boy, Jim, sounds like you’ve really turned into a social democrat.” This is what James Heckman remembers Lawrence Summers telling him one day in the early 1990s as they sat in Summers’s office in Washington. Heckman, an economist at the University of Chicago, was laying out his ideas about economic development to Summers, then a Treasury under secretary. Poor families should have guaranteed access to education for their 3- and 4-year-olds, Heckman said. He wasn’t advocating socialism, he told Summers, just the opposite: He was fixing a market failure.

Heckman won a Nobel prize in 2000. He used his speech in Stockholm to underscore the importance of using hard, observable data in making public policy, and he’s continued to gather evidence for the idea he explained to Summers. Focused, personal attention paid to the young children of poor families isn’t some warm, fuzzy notion, he argues. It’s a hard-nosed investment that pays off in lower social welfare costs, decreased crime rates, and increased tax revenue. And he has the numbers to prove it. He calls this the Heckman Equation, and shares it relentlessly in public lectures around the country and the world. “The argument is not just an appeal to the poor,” he says. “We’re saving money for everyone, including the taxpaying middle class and upper class. Right now they’re supporting prisons, health, special education in schools. The benefit is broadly shared. … It’s something that would actually accrue to the whole country.”