The Role of International Assessments of Cognitive Skills in the Analysis of Growth and Development Eric A. Hanushek Stanford University Ludger Woessmann University of Munich, ifo Institute International Large Scale Assessment Conference Education Testing Service March 2011
Elements of Discussion Outcomes of education Determinants of education Hanushek, Eric A., and Ludger Woessmann. "The economics of international differences in educational achievement." In Handbook of the Economics of Education, Vol. 3, edited by Eric A. Hanushek, Stephen Machin, and Ludger Woessmann. Amsterdam: North Holland, 2011: 89-200
Participation in IEA and OECD tests (through 2007) 20 OECD non-oecd Number of countries 15 10 5 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Number of tests participated (1964-2007)
Studies of the Economic Consequences of Human Capital Data source individual earnings Economic Consequences equity aggregate outcomes TOTAL IEA 1 1 2 OECD Other 6 3 1 10 Combined 13 13 TOTAL 6 4 15 25
Returns to Cognitive Skills (International Adult Literacy Survey) 0.25 0.2 0.15 0.1 0.05 0 Poland Sweden Czech Norway Denmark Italy Hungary Germany Finland Chile Switzerland Netherlands US
Cognitive Skills and Economic Growth
Years of Schooling and Economic Growth With quality control Without quality control
Scenario 1 Growth Projections - Achievement improves by 25 points (1/4 s.d.)
60% Annual Gains from 25 PISA-Points Improvement (1/4 std. dev.) 50% Percent addition to annual GDP 40% 30% 20% 10% 0% 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110 Year
60% Annual Gains from 25 PISA-Points Improvement (1/4 std. dev.) 50% Percent addition to annual GDP 40% 30% 20% 10% 0% 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110 Year
60% Annual Gains from 25 PISA-Points Improvement (1/4 std. dev.) 50% Percent addition to annual GDP 40% 30% 20% 10% 0% 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110 Year
Scenario 1 Growth Projections - Achievement improves by 25 points (1/4 s.d.) - PV = 288% of current GDP - $123T for OECD - $43T for United States
Growth Projections Scenario 1 - Achievement improves by 25 points (1/4 s.d.) Scenario 2 - Everybody Achieves at Level of Finland - PV = 645% of current GDP in OECD - $275T for OECD - $112 trillion for United States
Growth Projections Scenario 1 - Achievement improves by 25 points (1/4 s.d.) Scenario 2 - Everybody Achieves at Level of Finland Scenario 3 - All students to 400 points (basic skills) - PV = 530% of current GDP in OECD - $226T for OECD - $86 trillion for United States
Trends in Test Scores 560 540 Japan Korea Japan Korea Finland Netherlands N. Zealand Canada Australia UK 520 500 N. Zealand Norway Australia Netherlands UK Finland France Belgium Canada Sweden Germany USA Sweden France Belgium Norway USA Germany 480 Italy Italy 460 1975 2000
Trends in Growth Rates vs. Trends in Test Scores
School Performance in Peru 33 6 1 60 48 12 Never enrolled dropout gr 1-5 dropout gr 5-9 finish gr 9 w/o basic skills finish gr 9 with basic skills
Determinants of Human Capital Data source Determinants of Student Achievement family background plus school inputs Institutions within crosscountry within crosscountry country country Achievement equity TOTAL Unique Studies IEA 15 2 1 2 1 21 20 OECD 6 4 3 7 2 22 20 Other 2 2 1 5 4 Combined 3 3 4 6 16 16 TOTAL 24 11 6 14 9 64 60
500 450 Resources and Performance across Math performance in PISA 2003 550 Slovak Rep. Czech Rep. R 2 = 0.01 Poland R 2 = 0.15 Hungary Countries Korea Ireland Greece Finland Japan Netherlands Canada Belgium Switzerland Australia IcelandDenmark Sweden France Germany Austria Norway Spain USA Portugal Italy 400 Mexico 350 0 10000 20000 30000 40000 50000 60000 70000 80000 Cumulative educational expenditure per student
Alternative Estimates of Least Effective U.S. Teachers on Student Achievement 1.00 s.d. performance gain 0.75 0.50 0.25 Canada Finland 0.00 0% 2% 4% 6% 8% 10% 12% Percent deselected high estimate of teacher effectiveness low estimate of teacher effectiveness
Central Exams, School Autonomy, and Student Performance Math test score 80 70 76.2 60 55.5 50 40 30 20 23.7 10 Yes 0 No School autonomy over teacher salaries Yes 0.0 No Central exams TIMSS + TIMSS-R
Central Exams, School Autonomy, and Student Performance Math test score 80 70 60 64.1 67.6 50 40 30 20 22.7 10 Yes 0 No Teacher influence on resource funding Yes 0.0 No Central exams TIMSS + TIMSS-R
Measurement Issues to be Addressed Reliability at extremes (e.g., Peru) Intertemporal linkages Causation Panel of individuals Economic outcomes Labor market results Further schooling