Some Economic Consequences of Improving Mathematics Performance

In this report, we examine how improving mathematics performance has economic consequences through raising high school graduation rates. We investigate the link between higher mathematics achievement in school and subsequent human capital and labor market outcomes. We then predict the effect of improving math skills in grades 8 and 10 on the yield of high school graduates per age cohort. Improved mathematics achievement would most likely raise high school completion rates substantially, with especially strong impacts for lower socioeconomic groups and most minorities. We then present the lifetime economic consequences from a higher yield of high school graduates. In particular, we reviewed the impact on income and tax revenues, social productivity, and reductions in the costs of public health, crime, and public assistance. These lifetime consequences are calculated as gains to the individual students (private), as gains to the taxpayer (fiscal), and as gains to society (social). We simulate the total magnitude of these economic benefits if mathematics achievement in the U.S. were raised to equal that of other developed countries in the OECD, Canada, and a high performer, Finland. Finally, we review the evidence on interventions that have demonstrated effectiveness in improving mathematics achievement in high schools and middle schools. Although this evidence is somewhat sparse, we identify several effective interventions and estimate their costs. Given the substantial economic benefits from raising mathematics skills in high school, these interventions have very high benefit-cost ratios.